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III vs. NVEE: Which Stock Is the Better Value Option?

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Investors with an interest in Consulting Services stocks have likely encountered both Information Services Group (III - Free Report) and NV5 Holdings (NVEE - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Both Information Services Group and NV5 Holdings have a Zacks Rank of # 2 (Buy) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. But this is just one factor that value investors are interested in.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

III currently has a forward P/E ratio of 12.59, while NVEE has a forward P/E of 20.09. We also note that III has a PEG ratio of 0.90. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. NVEE currently has a PEG ratio of 1.20.

Another notable valuation metric for III is its P/B ratio of 1.64. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, NVEE has a P/B of 2.59.

These metrics, and several others, help III earn a Value grade of B, while NVEE has been given a Value grade of C.

Both III and NVEE are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that III is the superior value option right now.


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