Back to top

GIB or SYNT: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors looking for stocks in the Computer - Services sector might want to consider either CGI Group (GIB - Free Report) or Syntel . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

CGI Group has a Zacks Rank of #2 (Buy), while Syntel has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that GIB has an improving earnings outlook. 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.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

GIB currently has a forward P/E ratio of 17.66, while SYNT has a forward P/E of 20.77. We also note that GIB has a PEG ratio of 1.96. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SYNT currently has a PEG ratio of 2.08.

Another notable valuation metric for GIB is its P/B ratio of 3.37. 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, SYNT has a P/B of 52.47.

Based on these metrics and many more, GIB holds a Value grade of B, while SYNT has a Value grade of C.

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




In-Depth Zacks Research for the Tickers Above


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


CGI Group, Inc. (GIB) - free report >>

More from Zacks Tale of the Tape

You May Like

Published in