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CACI or FORR: Which Is the Better Value Stock Right Now?

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Investors interested in Computer - Services stocks are likely familiar with CACI International (CACI - Free Report) and Forrester Research (FORR - 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

CACI International has a Zacks Rank of #2 (Buy), while Forrester Research has a Zacks Rank of #3 (Hold) right now. This means that CACI's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.

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.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

CACI currently has a forward P/E ratio of 16.67, while FORR has a forward P/E of 28.20. We also note that CACI has a PEG ratio of 1.58. 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. FORR currently has a PEG ratio of 2.35.

Another notable valuation metric for CACI is its P/B ratio of 2.55. 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, FORR has a P/B of 4.51.

These metrics, and several others, help CACI earn a Value grade of A, while FORR has been given a Value grade of C.

CACI sticks out from FORR in both our Zacks Rank and Style Scores models, so value investors will likely feel that CACI is the better option right now.


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