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GTM or ADSK: Which Is the Better Value Stock Right Now?

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Investors with an interest in Internet - Software stocks have likely encountered both ZoomInfo (GTM - Free Report) and Autodesk (ADSK - 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.

Right now, ZoomInfo is sporting a Zacks Rank of #2 (Buy), while Autodesk has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that GTM is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

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.

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.

GTM currently has a forward P/E ratio of 11.78, while ADSK has a forward P/E of 32.79. We also note that GTM has a PEG ratio of 1.67. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. ADSK currently has a PEG ratio of 2.00.

Another notable valuation metric for GTM is its P/B ratio of 2.43. 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, ADSK has a P/B of 25.46.

These metrics, and several others, help GTM earn a Value grade of B, while ADSK has been given a Value grade of F.

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


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Autodesk, Inc. (ADSK) - free report >>

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