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G vs. PAYX: Which Stock Is the Better Value Option?
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Investors with an interest in Outsourcing stocks have likely encountered both Genpact (G - Free Report) and 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. 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.
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 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.
G currently has a forward P/E ratio of 16.10, while PAYX has a forward P/E of 27.30. We also note that G has a PEG ratio of 1.31. 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 3.64.
Another notable valuation metric for G is its P/B ratio of 4.37. 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 13.24.
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 with an interest in Outsourcing stocks have likely encountered both Genpact (G - Free Report) and 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. 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.
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 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.
G currently has a forward P/E ratio of 16.10, while PAYX has a forward P/E of 27.30. We also note that G has a PEG ratio of 1.31. 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 3.64.
Another notable valuation metric for G is its P/B ratio of 4.37. 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 13.24.
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.