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ALOT vs. TRI: Which Stock Should Value Investors Buy Now?

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Investors with an interest in Technology Services stocks have likely encountered both AstroNova (ALOT - Free Report) and Thomson Reuters (TRI - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

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.

Currently, AstroNova has a Zacks Rank of #2 (Buy), while Thomson Reuters has a Zacks Rank of #4 (Sell). Investors should feel comfortable knowing that ALOT likely has seen a stronger improvement to its earnings outlook than TRI 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 grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

ALOT currently has a forward P/E ratio of 36.22, while TRI has a forward P/E of 53.88. We also note that ALOT has a PEG ratio of 3.02. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. TRI currently has a PEG ratio of 4.48.

Another notable valuation metric for ALOT is its P/B ratio of 1.38. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, TRI has a P/B of 3.42.

Based on these metrics and many more, ALOT holds a Value grade of B, while TRI has a Value grade of C.

ALOT stands above TRI thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ALOT is the superior value option right now.


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