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CDW or NOW: Which Is the Better Value Stock Right Now?
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Investors interested in Computers - IT Services stocks are likely familiar with CDW (CDW - Free Report) and ServiceNow (NOW - 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.
Right now, both CDW and ServiceNow are sporting a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle 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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
CDW currently has a forward P/E ratio of 19.25, while NOW has a forward P/E of 57.99. We also note that CDW has a PEG ratio of 1.47. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. NOW currently has a PEG ratio of 2.30.
Another notable valuation metric for CDW is its P/B ratio of 15.70. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, NOW has a P/B of 20.25.
Based on these metrics and many more, CDW holds a Value grade of B, while NOW has a Value grade of D.
Both CDW and NOW are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CDW is the superior value option right now.
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CDW or NOW: Which Is the Better Value Stock Right Now?
Investors interested in Computers - IT Services stocks are likely familiar with CDW (CDW - Free Report) and ServiceNow (NOW - 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.
Right now, both CDW and ServiceNow are sporting a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle 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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
CDW currently has a forward P/E ratio of 19.25, while NOW has a forward P/E of 57.99. We also note that CDW has a PEG ratio of 1.47. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. NOW currently has a PEG ratio of 2.30.
Another notable valuation metric for CDW is its P/B ratio of 15.70. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, NOW has a P/B of 20.25.
Based on these metrics and many more, CDW holds a Value grade of B, while NOW has a Value grade of D.
Both CDW and NOW are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CDW is the superior value option right now.