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PERI vs. TTGT: Which Stock Is the Better Value Option?

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Investors with an interest in Internet - Content stocks have likely encountered both Perion Network (PERI - Free Report) and TechTarget (TTGT - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 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, Perion Network is sporting a Zacks Rank of #2 (Buy), while TechTarget has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that PERI likely has seen a stronger improvement to its earnings outlook than TTGT has recently. But this is only part of the picture for value investors.

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.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

PERI currently has a forward P/E ratio of 6.99, while TTGT has a forward P/E of 18.92. We also note that PERI has a PEG ratio of 0.32. 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. TTGT currently has a PEG ratio of 3.50.

Another notable valuation metric for PERI is its P/B ratio of 1.50. 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, TTGT has a P/B of 4.04.

These are just a few of the metrics contributing to PERI's Value grade of A and TTGT's Value grade of D.

PERI is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that PERI is likely the superior value option right now.


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