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CDW or NOW: Which Is the Better Value Stock Right Now?
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Investors looking for stocks in the Computers - IT Services sector might want to consider either CDW (CDW - Free Report) or ServiceNow (NOW - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, both CDW and ServiceNow are sporting a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. But this is just one piece of the puzzle for value investors.
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.
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.
CDW currently has a forward P/E ratio of 24.98, while NOW has a forward P/E of 112.04. We also note that CDW has a PEG ratio of 1.91. 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. NOW currently has a PEG ratio of 3.98.
Another notable valuation metric for CDW is its P/B ratio of 25.21. 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, NOW has a P/B of 39.29.
These are just a few of the metrics contributing to CDW's Value grade of B and NOW's Value grade of F.
Both CDW and NOW are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CDW is the superior value option right now.
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CDW or NOW: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Computers - IT Services sector might want to consider either CDW (CDW - Free Report) or ServiceNow (NOW - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, both CDW and ServiceNow are sporting a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. But this is just one piece of the puzzle for value investors.
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.
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.
CDW currently has a forward P/E ratio of 24.98, while NOW has a forward P/E of 112.04. We also note that CDW has a PEG ratio of 1.91. 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. NOW currently has a PEG ratio of 3.98.
Another notable valuation metric for CDW is its P/B ratio of 25.21. 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, NOW has a P/B of 39.29.
These are just a few of the metrics contributing to CDW's Value grade of B and NOW's Value grade of F.
Both CDW and NOW are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CDW is the superior value option right now.