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G vs. PAYX: Which Stock Is the Better Value Option?
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Investors looking for stocks in the Outsourcing sector might want to consider either Genpact (G - Free Report) or Paychex (PAYX - 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.
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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Genpact and Paychex are both sporting a Zacks Rank of # 2 (Buy) right now. 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 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 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.
G currently has a forward P/E ratio of 15.06, while PAYX has a forward P/E of 32.08. We also note that G has a PEG ratio of 1.22. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. PAYX currently has a PEG ratio of 4.28.
Another notable valuation metric for G is its P/B ratio of 4.02. 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, PAYX has a P/B of 13.21.
These metrics, and several others, help G earn a Value grade of B, while PAYX has been given a Value grade of D.
Both G and PAYX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that G is the superior value option right now.
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G vs. PAYX: Which Stock Is the Better Value Option?
Investors looking for stocks in the Outsourcing sector might want to consider either Genpact (G - Free Report) or Paychex (PAYX - 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.
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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Genpact and Paychex are both sporting a Zacks Rank of # 2 (Buy) right now. 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 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 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.
G currently has a forward P/E ratio of 15.06, while PAYX has a forward P/E of 32.08. We also note that G has a PEG ratio of 1.22. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. PAYX currently has a PEG ratio of 4.28.
Another notable valuation metric for G is its P/B ratio of 4.02. 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, PAYX has a P/B of 13.21.
These metrics, and several others, help G earn a Value grade of B, while PAYX has been given a Value grade of D.
Both G and PAYX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that G is the superior value option right now.