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DTEGY or BCE: Which Is the Better Value Stock Right Now?

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Investors looking for stocks in the Diversified Communication Services sector might want to consider either Deutsche Telekom AG (DTEGY - Free Report) or BCE (BCE - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Deutsche Telekom AG has a Zacks Rank of #1 (Strong Buy), while BCE has a Zacks Rank of #4 (Sell) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that DTEGY is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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.

DTEGY currently has a forward P/E ratio of 12.32, while BCE has a forward P/E of 18.62. We also note that DTEGY has a PEG ratio of 0.88. 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. BCE currently has a PEG ratio of 4.57.

Another notable valuation metric for DTEGY is its P/B ratio of 1.10. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, BCE has a P/B of 2.91.

These are just a few of the metrics contributing to DTEGY's Value grade of A and BCE's Value grade of C.

DTEGY sticks out from BCE in both our Zacks Rank and Style Scores models, so value investors will likely feel that DTEGY is the better option right now.


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