We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
GFS vs. AMBA: Which Stock Is the Better Value Option?
Read MoreHide Full Article
Investors with an interest in Electronics - Semiconductors stocks have likely encountered both GlobalFoundries Inc. (GFS - Free Report) and Ambarella (AMBA - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
GlobalFoundries Inc. has a Zacks Rank of #2 (Buy), while Ambarella has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that GFS likely has seen a stronger improvement to its earnings outlook than AMBA has recently. But this is only part of the picture for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.
GFS currently has a forward P/E ratio of 22.50, while AMBA has a forward P/E of 68.46. We also note that GFS has a PEG ratio of 0.47. 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. AMBA currently has a PEG ratio of 7.68.
Another notable valuation metric for GFS is its P/B ratio of 3.96. 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, AMBA has a P/B of 4.77.
These are just a few of the metrics contributing to GFS's Value grade of B and AMBA's Value grade of F.
GFS stands above AMBA thanks to its solid earnings outlook, and based on these valuation figures, we also feel that GFS is the superior value option right now.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
GFS vs. AMBA: Which Stock Is the Better Value Option?
Investors with an interest in Electronics - Semiconductors stocks have likely encountered both GlobalFoundries Inc. (GFS - Free Report) and Ambarella (AMBA - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
GlobalFoundries Inc. has a Zacks Rank of #2 (Buy), while Ambarella has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that GFS likely has seen a stronger improvement to its earnings outlook than AMBA has recently. But this is only part of the picture for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.
GFS currently has a forward P/E ratio of 22.50, while AMBA has a forward P/E of 68.46. We also note that GFS has a PEG ratio of 0.47. 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. AMBA currently has a PEG ratio of 7.68.
Another notable valuation metric for GFS is its P/B ratio of 3.96. 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, AMBA has a P/B of 4.77.
These are just a few of the metrics contributing to GFS's Value grade of B and AMBA's Value grade of F.
GFS stands above AMBA thanks to its solid earnings outlook, and based on these valuation figures, we also feel that GFS is the superior value option right now.