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VRT vs. DT: Which Stock Is the Better Value Option?
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Investors interested in stocks from the Computers - IT Services sector have probably already heard of Vertiv Holdings Co. (VRT - Free Report) and Dynatrace (DT - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, both Vertiv Holdings Co. and Dynatrace are holding a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. However, value investors will care about much more than just this.
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.
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.
VRT currently has a forward P/E ratio of 12.31, while DT has a forward P/E of 46.70. We also note that VRT has a PEG ratio of 0.32. 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. DT currently has a PEG ratio of 2.32.
Another notable valuation metric for VRT is its P/B ratio of 3.65. 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, DT has a P/B of 7.71.
These metrics, and several others, help VRT earn a Value grade of B, while DT has been given a Value grade of D.
Both VRT and DT are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that VRT is the superior value option right now.
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VRT vs. DT: Which Stock Is the Better Value Option?
Investors interested in stocks from the Computers - IT Services sector have probably already heard of Vertiv Holdings Co. (VRT - Free Report) and Dynatrace (DT - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, both Vertiv Holdings Co. and Dynatrace are holding a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. However, value investors will care about much more than just this.
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.
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.
VRT currently has a forward P/E ratio of 12.31, while DT has a forward P/E of 46.70. We also note that VRT has a PEG ratio of 0.32. 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. DT currently has a PEG ratio of 2.32.
Another notable valuation metric for VRT is its P/B ratio of 3.65. 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, DT has a P/B of 7.71.
These metrics, and several others, help VRT earn a Value grade of B, while DT has been given a Value grade of D.
Both VRT and DT are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that VRT is the superior value option right now.