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BIDU or GOOG: Which Is the Better Value Stock Right Now?
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Investors interested in stocks from the Internet - Services sector have probably already heard of Baidu Inc. (BIDU - Free Report) and Alphabet Inc. (GOOG - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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.
Baidu Inc. has a Zacks Rank of #2 (Buy), while Alphabet Inc. has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that BIDU is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle 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.
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.
BIDU currently has a forward P/E ratio of 15.24, while GOOG has a forward P/E of 21.47. We also note that BIDU has a PEG ratio of 0.73. 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. GOOG currently has a PEG ratio of 1.81.
Another notable valuation metric for BIDU is its P/B ratio of 1.45. 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, GOOG has a P/B of 5.71.
These metrics, and several others, help BIDU earn a Value grade of B, while GOOG has been given a Value grade of C.
BIDU stands above GOOG thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BIDU is the superior value option right now.
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BIDU or GOOG: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Internet - Services sector have probably already heard of Baidu Inc. (BIDU - Free Report) and Alphabet Inc. (GOOG - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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.
Baidu Inc. has a Zacks Rank of #2 (Buy), while Alphabet Inc. has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that BIDU is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle 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.
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.
BIDU currently has a forward P/E ratio of 15.24, while GOOG has a forward P/E of 21.47. We also note that BIDU has a PEG ratio of 0.73. 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. GOOG currently has a PEG ratio of 1.81.
Another notable valuation metric for BIDU is its P/B ratio of 1.45. 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, GOOG has a P/B of 5.71.
These metrics, and several others, help BIDU earn a Value grade of B, while GOOG has been given a Value grade of C.
BIDU stands above GOOG thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BIDU is the superior value option right now.