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ASGN vs. DT: Which Stock Should Value Investors Buy Now?

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Investors interested in stocks from the Computers - IT Services sector have probably already heard of ASGN Inc (ASGN - Free Report) and Dynatrace (DT - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Right now, both ASGN Inc and Dynatrace are sporting a Zacks Rank of # 2 (Buy). Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. 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.

ASGN currently has a forward P/E ratio of 18.38, while DT has a forward P/E of 82.44. We also note that ASGN has a PEG ratio of 1.93. 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. DT currently has a PEG ratio of 2.33.

Another notable valuation metric for ASGN is its P/B ratio of 3.22. 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, DT has a P/B of 13.47.

Based on these metrics and many more, ASGN holds a Value grade of B, while DT has a Value grade of F.

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


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ASGN Incorporated (ASGN) - free report >>

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