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

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Investors with an interest in Business - Services stocks have likely encountered both Concentrix Corporation (CNXC - Free Report) and HeadHunter Group PLC Sponsored ADR (HHR - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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, both Concentrix Corporation and HeadHunter Group PLC Sponsored ADR are holding 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 only part of the picture for value investors.

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.

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 18.70, while HHR has a forward P/E of 38.90. We also note that CNXC has a PEG ratio of 0.89. 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. HHR currently has a PEG ratio of 1.37.

Another notable valuation metric for CNXC is its P/B ratio of 3.74. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, HHR has a P/B of 38.17.

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

Both CNXC and HHR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CNXC is the superior value option right now.


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