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JNPR vs. MSI: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Wireless Equipment sector might want to consider either Juniper Networks (JNPR - Free Report) or Motorola (MSI - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, Juniper Networks is sporting a Zacks Rank of #2 (Buy), while Motorola has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that JNPR has an improving earnings outlook. But this is only part of the picture for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

JNPR currently has a forward P/E ratio of 15.08, while MSI has a forward P/E of 25.58. We also note that JNPR has a PEG ratio of 2.17. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. MSI currently has a PEG ratio of 2.84.

Another notable valuation metric for JNPR is its P/B ratio of 2.48. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, MSI has a P/B of 364.91.

Based on these metrics and many more, JNPR holds a Value grade of B, while MSI has a Value grade of C.

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


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Juniper Networks, Inc. (JNPR) - free report >>

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