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SYKE or ADP: Which Is the Better Value Stock Right Now?
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Investors with an interest in Outsourcing stocks have likely encountered both Sykes Enterprises and Automatic Data Processing (ADP - 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.
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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, Sykes Enterprises has a Zacks Rank of #2 (Buy), while Automatic Data Processing has a Zacks Rank of #3 (Hold). This means that SYKE'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 are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
SYKE currently has a forward P/E ratio of 17.41, while ADP has a forward P/E of 30.57. We also note that SYKE has a PEG ratio of 1.74. 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. ADP currently has a PEG ratio of 2.55.
Another notable valuation metric for SYKE is its P/B ratio of 2.32. 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, ADP has a P/B of 14.98.
These are just a few of the metrics contributing to SYKE's Value grade of B and ADP's Value grade of C.
SYKE stands above ADP thanks to its solid earnings outlook, and based on these valuation figures, we also feel that SYKE is the superior value option right now.
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SYKE or ADP: Which Is the Better Value Stock Right Now?
Investors with an interest in Outsourcing stocks have likely encountered both Sykes Enterprises and Automatic Data Processing (ADP - 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.
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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, Sykes Enterprises has a Zacks Rank of #2 (Buy), while Automatic Data Processing has a Zacks Rank of #3 (Hold). This means that SYKE'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 are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
SYKE currently has a forward P/E ratio of 17.41, while ADP has a forward P/E of 30.57. We also note that SYKE has a PEG ratio of 1.74. 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. ADP currently has a PEG ratio of 2.55.
Another notable valuation metric for SYKE is its P/B ratio of 2.32. 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, ADP has a P/B of 14.98.
These are just a few of the metrics contributing to SYKE's Value grade of B and ADP's Value grade of C.
SYKE stands above ADP thanks to its solid earnings outlook, and based on these valuation figures, we also feel that SYKE is the superior value option right now.