Back to top

Image: Bigstock

EGHT vs. ADYEY: Which Stock Should Value Investors Buy Now?

Read MoreHide Full Article

Investors with an interest in Internet - Software stocks have likely encountered both 8x8 (EGHT - Free Report) and Adyen N.V. Unsponsored ADR (ADYEY - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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.

8x8 has a Zacks Rank of #2 (Buy), while Adyen N.V. Unsponsored ADR has a Zacks Rank of #4 (Sell) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that EGHT has an improving earnings outlook. But this is only part of the picture 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.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

EGHT currently has a forward P/E ratio of 6.46, while ADYEY has a forward P/E of 42.83. We also note that EGHT has a PEG ratio of 0.74. 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. ADYEY currently has a PEG ratio of 2.34.

Another notable valuation metric for EGHT is its P/B ratio of 2.12. 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, ADYEY has a P/B of 11.56.

Based on these metrics and many more, EGHT holds a Value grade of A, while ADYEY has a Value grade of F.

EGHT sticks out from ADYEY in both our Zacks Rank and Style Scores models, so value investors will likely feel that EGHT is the better option right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


8x8 Inc (EGHT) - free report >>

Adyen N.V. Unsponsored ADR (ADYEY) - free report >>

Published in