Investors interested in Computer - Services stocks are likely familiar with LogMein (LOGM - Free Report) and ManTech International (MANT - 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.
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 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.
Currently, LogMein has a Zacks Rank of #1 (Strong Buy), while ManTech International has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that LOGM has an improving earnings outlook. But this is just one factor that value investors are interested in.
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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
LOGM currently has a forward P/E ratio of 15.25, while MANT has a forward P/E of 30.12. We also note that LOGM has a PEG ratio of 3.05. 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. MANT currently has a PEG ratio of 3.77.
Another notable valuation metric for LOGM is its P/B ratio of 1.36. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, MANT has a P/B of 1.93.
Based on these metrics and many more, LOGM holds a Value grade of B, while MANT has a Value grade of C.
LOGM stands above MANT thanks to its solid earnings outlook, and based on these valuation figures, we also feel that LOGM is the superior value option right now.