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APG vs. SGSOY: Which Stock Is the Better Value Option?

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Investors with an interest in Business - Services stocks have likely encountered both APi (APG - Free Report) and SGS SA (SGSOY - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, APi has a Zacks Rank of #1 (Strong Buy), while SGS SA has a Zacks Rank of #4 (Sell). Investors should feel comfortable knowing that APG likely has seen a stronger improvement to its earnings outlook than SGSOY has recently. However, value investors will care about much more than just this.

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.

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.

APG currently has a forward P/E ratio of 20.69, while SGSOY has a forward P/E of 22.20. We also note that APG has a PEG ratio of 1.16. 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. SGSOY currently has a PEG ratio of 2.67.

Another notable valuation metric for APG is its P/B ratio of 4.39. 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, SGSOY has a P/B of 28.29.

These are just a few of the metrics contributing to APG's Value grade of B and SGSOY's Value grade of C.

APG stands above SGSOY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that APG is the superior value option right now.


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