Back to top

Image: Bigstock

PERI vs. DHX: Which Stock Should Value Investors Buy Now?

Read MoreHide Full Article

Investors looking for stocks in the Internet - Content sector might want to consider either Perion Network (PERI - Free Report) or DHI Group (DHX - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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.

Right now, Perion Network is sporting a Zacks Rank of #2 (Buy), while DHI Group 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 PERI 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 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.

PERI currently has a forward P/E ratio of 22.07, while DHX has a forward P/E of 100. We also note that PERI 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. DHX currently has a PEG ratio of 4.

Another notable valuation metric for PERI is its P/B ratio of 2.42. 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, DHX has a P/B of 2.55.

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

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Perion Network Ltd (PERI) - free report >>

DHI Group, Inc. (DHX) - free report >>

Published in