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SNX vs. HOCPY: Which Stock Should Value Investors Buy Now?

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Investors interested in Electronics - Miscellaneous Products stocks are likely familiar with TD SYNNEX (SNX - Free Report) and Hoya Corp. (HOCPY - 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 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.

Right now, TD SYNNEX is sporting a Zacks Rank of #1 (Strong Buy), while Hoya Corp. has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that SNX 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.

SNX currently has a forward P/E ratio of 11.58, while HOCPY has a forward P/E of 37.35. We also note that SNX has a PEG ratio of 1.08. 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. HOCPY currently has a PEG ratio of 3.24.

Another notable valuation metric for SNX is its P/B ratio of 1.44. 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, HOCPY has a P/B of 8.28.

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

SNX 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 SNX is likely the superior value option right now.


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