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SIFY vs. TTD: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Internet - Services sector might want to consider either Sify Technologies Limited (SIFY - Free Report) or The Trade Desk (TTD - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Sify Technologies Limited is sporting a Zacks Rank of #2 (Buy), while The Trade Desk has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that SIFY has an improving earnings outlook. However, value investors will care about much more than just this.

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.

SIFY currently has a forward P/E ratio of 22.40, while TTD has a forward P/E of 42.31. We also note that SIFY has a PEG ratio of 1.12. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. TTD currently has a PEG ratio of 1.76.

Another notable valuation metric for SIFY is its P/B ratio of 2.14. 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, TTD has a P/B of 12.56.

These metrics, and several others, help SIFY earn a Value grade of A, while TTD has been given a Value grade of F.

SIFY is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that SIFY is likely the superior value option right now.


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