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PCRFY vs. DLB: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Audio Video Production sector have probably already heard of Panasonic Corp. (PCRFY - Free Report) and Dolby Laboratories (DLB - 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Panasonic Corp. is sporting a Zacks Rank of #2 (Buy), while Dolby Laboratories has a Zacks Rank of #5 (Strong Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that PCRFY has an improving earnings outlook. But this is just one factor that value investors are interested in.

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.

PCRFY currently has a forward P/E ratio of 12.77, while DLB has a forward P/E of 23.48. We also note that PCRFY has a PEG ratio of 0.50. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. DLB currently has a PEG ratio of 1.81.

Another notable valuation metric for PCRFY is its P/B ratio of 1.15. 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, DLB has a P/B of 3.49.

Based on these metrics and many more, PCRFY holds a Value grade of A, while DLB has a Value grade of D.

PCRFY has seen stronger estimate revision activity and sports more attractive valuation metrics than DLB, so it seems like value investors will conclude that PCRFY is the superior option right now.


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