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CHGG vs. INFA: Which Stock Should Value Investors Buy Now?
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Investors interested in stocks from the Internet - Software sector have probably already heard of Chegg (CHGG - Free Report) and Informatica Inc. (INFA - 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Chegg has a Zacks Rank of #2 (Buy), while Informatica Inc. has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that CHGG has an improving earnings outlook. But this is just one piece of the puzzle 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.
CHGG currently has a forward P/E ratio of 6.84, while INFA has a forward P/E of 34.35. We also note that CHGG has a PEG ratio of 0.34. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. INFA currently has a PEG ratio of 4.12.
Another notable valuation metric for CHGG is its P/B ratio of 0.92. 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, INFA has a P/B of 5.78.
These are just a few of the metrics contributing to CHGG's Value grade of A and INFA's Value grade of F.
CHGG 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 CHGG is likely the superior value option right now.
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CHGG vs. INFA: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Internet - Software sector have probably already heard of Chegg (CHGG - Free Report) and Informatica Inc. (INFA - 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Chegg has a Zacks Rank of #2 (Buy), while Informatica Inc. has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that CHGG has an improving earnings outlook. But this is just one piece of the puzzle 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.
CHGG currently has a forward P/E ratio of 6.84, while INFA has a forward P/E of 34.35. We also note that CHGG has a PEG ratio of 0.34. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. INFA currently has a PEG ratio of 4.12.
Another notable valuation metric for CHGG is its P/B ratio of 0.92. 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, INFA has a P/B of 5.78.
These are just a few of the metrics contributing to CHGG's Value grade of A and INFA's Value grade of F.
CHGG 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 CHGG is likely the superior value option right now.