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CNXC vs. WNS: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Business - Services sector might want to consider either Concentrix Corporation (CNXC - Free Report) or WNS Holdings Limited (WNS - 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.

Currently, Concentrix Corporation has a Zacks Rank of #2 (Buy), while WNS Holdings Limited 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 CNXC has an improving earnings outlook. However, value investors will care about much more than just this.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.

CNXC currently has a forward P/E ratio of 18.54, while WNS has a forward P/E of 25.92. We also note that CNXC has a PEG ratio of 0.88. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. WNS currently has a PEG ratio of 1.97.

Another notable valuation metric for CNXC is its P/B ratio of 3.71. 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, WNS has a P/B of 6.50.

These are just a few of the metrics contributing to CNXC's Value grade of B and WNS's Value grade of C.

CNXC 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 CNXC is likely the superior value option right now.


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