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PERI vs. RELX: Which Stock Is the Better Value Option?

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Investors with an interest in Internet - Content stocks have likely encountered both Perion Network (PERI - Free Report) and RELX PLC (RELX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.

Perion Network and RELX PLC are sporting Zacks Ranks of #1 (Strong Buy) and #4 (Sell), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that PERI 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 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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

PERI currently has a forward P/E ratio of 12.53, while RELX has a forward P/E of 22.17. We also note that PERI has a PEG ratio of 0.50. 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. RELX currently has a PEG ratio of 2.09.

Another notable valuation metric for PERI is its P/B ratio of 2.57. 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, RELX has a P/B of 12.40.

These are just a few of the metrics contributing to PERI's Value grade of B and RELX's Value grade of D.

PERI has seen stronger estimate revision activity and sports more attractive valuation metrics than RELX, so it seems like value investors will conclude that PERI is the superior option right now.


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