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UMC vs. AVGO: Which Stock Is the Better Value Option?
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Investors looking for stocks in the Electronics - Semiconductors sector might want to consider either United Microelectronics Corporation (UMC - Free Report) or Broadcom Inc. (AVGO - 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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Both United Microelectronics Corporation and Broadcom Inc. have a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one piece of the puzzle 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.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
UMC currently has a forward P/E ratio of 8.72, while AVGO has a forward P/E of 17.72. We also note that UMC has a PEG ratio of 0.30. 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. AVGO currently has a PEG ratio of 1.22.
Another notable valuation metric for UMC is its P/B ratio of 2.53. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, AVGO has a P/B of 9.73.
These are just a few of the metrics contributing to UMC's Value grade of A and AVGO's Value grade of C.
Both UMC and AVGO are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that UMC is the superior value option right now.
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UMC vs. AVGO: Which Stock Is the Better Value Option?
Investors looking for stocks in the Electronics - Semiconductors sector might want to consider either United Microelectronics Corporation (UMC - Free Report) or Broadcom Inc. (AVGO - 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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Both United Microelectronics Corporation and Broadcom Inc. have a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one piece of the puzzle 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.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
UMC currently has a forward P/E ratio of 8.72, while AVGO has a forward P/E of 17.72. We also note that UMC has a PEG ratio of 0.30. 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. AVGO currently has a PEG ratio of 1.22.
Another notable valuation metric for UMC is its P/B ratio of 2.53. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, AVGO has a P/B of 9.73.
These are just a few of the metrics contributing to UMC's Value grade of A and AVGO's Value grade of C.
Both UMC and AVGO are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that UMC is the superior value option right now.