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ASX vs. AMBA: Which Stock Should Value Investors Buy Now?
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Investors interested in Electronics - Semiconductors stocks are likely familiar with ASE Technology Hldg (ASX - Free Report) and Ambarella (AMBA - 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.
Right now, ASE Technology Hldg is sporting a Zacks Rank of #2 (Buy), while Ambarella has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ASX has an improving earnings outlook. However, value investors will care about much more than just this.
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 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.
ASX currently has a forward P/E ratio of 12.27, while AMBA has a forward P/E of 102.72. We also note that ASX has a PEG ratio of 0.82. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. AMBA currently has a PEG ratio of 6.85.
Another notable valuation metric for ASX is its P/B ratio of 2.04. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, AMBA has a P/B of 7.23.
Based on these metrics and many more, ASX holds a Value grade of A, while AMBA has a Value grade of F.
ASX is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that ASX is likely the superior value option right now.
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ASX vs. AMBA: Which Stock Should Value Investors Buy Now?
Investors interested in Electronics - Semiconductors stocks are likely familiar with ASE Technology Hldg (ASX - Free Report) and Ambarella (AMBA - 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.
Right now, ASE Technology Hldg is sporting a Zacks Rank of #2 (Buy), while Ambarella has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that ASX has an improving earnings outlook. However, value investors will care about much more than just this.
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 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.
ASX currently has a forward P/E ratio of 12.27, while AMBA has a forward P/E of 102.72. We also note that ASX has a PEG ratio of 0.82. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. AMBA currently has a PEG ratio of 6.85.
Another notable valuation metric for ASX is its P/B ratio of 2.04. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, AMBA has a P/B of 7.23.
Based on these metrics and many more, ASX holds a Value grade of A, while AMBA has a Value grade of F.
ASX is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that ASX is likely the superior value option right now.