Back to top

Image: Bigstock

VOD or CRNT: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors looking for stocks in the Wireless Non-US sector might want to consider either Vodafone Group PLC (VOD - Free Report) or Ceragon Networks (CRNT - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Vodafone Group PLC has a Zacks Rank of #2 (Buy), while Ceragon Networks has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that VOD likely has seen a stronger improvement to its earnings outlook than CRNT has recently. However, value investors will care about much more than just this.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

VOD currently has a forward P/E ratio of 16.21, while CRNT has a forward P/E of 136.25. We also note that VOD has a PEG ratio of 1.01. 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. CRNT currently has a PEG ratio of 9.08.

Another notable valuation metric for VOD is its P/B ratio of 0.61. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, CRNT has a P/B of 2.94.

Based on these metrics and many more, VOD holds a Value grade of A, while CRNT has a Value grade of D.

VOD has seen stronger estimate revision activity and sports more attractive valuation metrics than CRNT, so it seems like value investors will conclude that VOD is the superior option right now.

In-Depth Zacks Research for the Tickers Above

Normally $25 each - click below to receive one report FREE:

Vodafone Group PLC (VOD) - free report >>

Ceragon Networks Ltd. (CRNT) - free report >>

Published in