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BBSI or PAYX: Which Is the Better Value Stock Right Now?
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Investors with an interest in Outsourcing stocks have likely encountered both Barrett Business Services (BBSI - Free Report) and Paychex (PAYX - 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.
Barrett Business Services and Paychex are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. This means that BBSI's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its 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.
BBSI currently has a forward P/E ratio of 15.66, while PAYX has a forward P/E of 26.56. We also note that BBSI has a PEG ratio of 1.12. 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. PAYX currently has a PEG ratio of 3.39.
Another notable valuation metric for BBSI is its P/B ratio of 4.08. 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, PAYX has a P/B of 12.57.
These are just a few of the metrics contributing to BBSI's Value grade of A and PAYX's Value grade of D.
BBSI has seen stronger estimate revision activity and sports more attractive valuation metrics than PAYX, so it seems like value investors will conclude that BBSI is the superior option right now.
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BBSI or PAYX: Which Is the Better Value Stock Right Now?
Investors with an interest in Outsourcing stocks have likely encountered both Barrett Business Services (BBSI - Free Report) and Paychex (PAYX - 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.
Barrett Business Services and Paychex are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. This means that BBSI's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its 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.
BBSI currently has a forward P/E ratio of 15.66, while PAYX has a forward P/E of 26.56. We also note that BBSI has a PEG ratio of 1.12. 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. PAYX currently has a PEG ratio of 3.39.
Another notable valuation metric for BBSI is its P/B ratio of 4.08. 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, PAYX has a P/B of 12.57.
These are just a few of the metrics contributing to BBSI's Value grade of A and PAYX's Value grade of D.
BBSI has seen stronger estimate revision activity and sports more attractive valuation metrics than PAYX, so it seems like value investors will conclude that BBSI is the superior option right now.