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IDCC or MSI: Which Is the Better Value Stock Right Now?
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Investors interested in Wireless Equipment stocks are likely familiar with InterDigital (IDCC - Free Report) and Motorola (MSI - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Right now, InterDigital is sporting a Zacks Rank of #1 (Strong 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 IDCC has an improving earnings outlook. But this is just one factor that value investors are interested in.
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.
IDCC currently has a forward P/E ratio of 11.99, while MSI has a forward P/E of 25.90. We also note that IDCC has a PEG ratio of 0.86. 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 2.88.
Another notable valuation metric for IDCC is its P/B ratio of 4.19. 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, MSI has a P/B of 196.05.
These metrics, and several others, help IDCC earn a Value grade of B, while MSI has been given a Value grade of C.
IDCC has seen stronger estimate revision activity and sports more attractive valuation metrics than MSI, so it seems like value investors will conclude that IDCC is the superior option right now.
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IDCC or MSI: Which Is the Better Value Stock Right Now?
Investors interested in Wireless Equipment stocks are likely familiar with InterDigital (IDCC - Free Report) and Motorola (MSI - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Right now, InterDigital is sporting a Zacks Rank of #1 (Strong 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 IDCC has an improving earnings outlook. But this is just one factor that value investors are interested in.
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.
IDCC currently has a forward P/E ratio of 11.99, while MSI has a forward P/E of 25.90. We also note that IDCC has a PEG ratio of 0.86. 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 2.88.
Another notable valuation metric for IDCC is its P/B ratio of 4.19. 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, MSI has a P/B of 196.05.
These metrics, and several others, help IDCC earn a Value grade of B, while MSI has been given a Value grade of C.
IDCC has seen stronger estimate revision activity and sports more attractive valuation metrics than MSI, so it seems like value investors will conclude that IDCC is the superior option right now.