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NU or CLBT: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Technology Services sector might want to consider either Nu Holdings Ltd. (NU - Free Report) or Cellebrite DI Ltd. (CLBT - 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.
Currently, Nu Holdings Ltd. has a Zacks Rank of #2 (Buy), while Cellebrite DI Ltd. 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 NU has an improving earnings outlook. But this is just one factor that value investors are interested in.
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 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.
NU currently has a forward P/E ratio of 37.15, while CLBT has a forward P/E of 44.66. We also note that NU has a PEG ratio of 0.69. 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. CLBT currently has a PEG ratio of 1.95.
Another notable valuation metric for NU is its P/B ratio of 10.48. 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, CLBT has a P/B of 12.85.
These are just a few of the metrics contributing to NU's Value grade of B and CLBT's Value grade of D.
NU has seen stronger estimate revision activity and sports more attractive valuation metrics than CLBT, so it seems like value investors will conclude that NU is the superior option right now.