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OSPN vs. HUBS: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Internet - Software sector might want to consider either OneSpan (OSPN - Free Report) or HubSpot (HUBS - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

OneSpan and HubSpot are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that OSPN is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.

OSPN currently has a forward P/E ratio of 10.08, while HUBS has a forward P/E of 19.59. We also note that OSPN has a PEG ratio of 0.92. 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. HUBS currently has a PEG ratio of 0.98.

Another notable valuation metric for OSPN is its P/B ratio of 1.66. 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, HUBS has a P/B of 6.18.

Based on these metrics and many more, OSPN holds a Value grade of A, while HUBS has a Value grade of D.

OSPN 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 OSPN is likely the superior value option right now.

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