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VIVHY or TU: Which Is the Better Value Stock Right Now?

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Investors with an interest in Diversified Communication Services stocks have likely encountered both Vivendi SA (VIVHY - Free Report) and Telus (TU - 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Vivendi SA has a Zacks Rank of #2 (Buy), while Telus has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that VIVHY has an improving earnings outlook. But this is just one factor that value investors are interested in.

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.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

VIVHY currently has a forward P/E ratio of 16.14, while TU has a forward P/E of 26.24. We also note that VIVHY has a PEG ratio of 0.93. 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. TU currently has a PEG ratio of 2.83.

Another notable valuation metric for VIVHY is its P/B ratio of 0.63. 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, TU has a P/B of 2.66.

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

VIVHY sticks out from TU in both our Zacks Rank and Style Scores models, so value investors will likely feel that VIVHY is the better option right now.


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