Investors with an interest in Internet - Software and Services stocks have likely encountered both Criteo S.A. (CRTO - Free Report) and Quotient Technology (QUOT - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.
Criteo S.A. has a Zacks Rank of #1 (Strong Buy), while Quotient Technology has a Zacks Rank of #4 (Sell) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that CRTO is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
CRTO currently has a forward P/E ratio of 8.14, while QUOT has a forward P/E of 117.14. We also note that CRTO has a PEG ratio of 1.63. 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. QUOT currently has a PEG ratio of 8.08.
Another notable valuation metric for CRTO is its P/B ratio of 1.29. 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, QUOT has a P/B of 2.77.
These are just a few of the metrics contributing to CRTO's Value grade of A and QUOT's Value grade of D.
CRTO sticks out from QUOT in both our Zacks Rank and Style Scores models, so value investors will likely feel that CRTO is the better option right now.