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CDW vs. NOW: Which Stock Is the Better Value Option?
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Investors interested in stocks from the Computers - IT Services sector have probably already heard of CDW (CDW - Free Report) and ServiceNow (NOW - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Currently, CDW has a Zacks Rank of #1 (Strong Buy), while ServiceNow has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that CDW likely has seen a stronger improvement to its earnings outlook than NOW has recently. But this is just one piece of the puzzle for value investors.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
CDW currently has a forward P/E ratio of 22.31, while NOW has a forward P/E of 116.85. We also note that CDW has a PEG ratio of 1.70. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. NOW currently has a PEG ratio of 4.10.
Another notable valuation metric for CDW is its P/B ratio of 17.43. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, NOW has a P/B of 40.10.
These metrics, and several others, help CDW earn a Value grade of B, while NOW has been given a Value grade of D.
CDW sticks out from NOW in both our Zacks Rank and Style Scores models, so value investors will likely feel that CDW is the better option right now.
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CDW vs. NOW: Which Stock Is the Better Value Option?
Investors interested in stocks from the Computers - IT Services sector have probably already heard of CDW (CDW - Free Report) and ServiceNow (NOW - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Currently, CDW has a Zacks Rank of #1 (Strong Buy), while ServiceNow has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that CDW likely has seen a stronger improvement to its earnings outlook than NOW has recently. But this is just one piece of the puzzle for value investors.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
CDW currently has a forward P/E ratio of 22.31, while NOW has a forward P/E of 116.85. We also note that CDW has a PEG ratio of 1.70. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. NOW currently has a PEG ratio of 4.10.
Another notable valuation metric for CDW is its P/B ratio of 17.43. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, NOW has a P/B of 40.10.
These metrics, and several others, help CDW earn a Value grade of B, while NOW has been given a Value grade of D.
CDW sticks out from NOW in both our Zacks Rank and Style Scores models, so value investors will likely feel that CDW is the better option right now.