Back to top

Image: Bigstock

PERI vs. BCOV: Which Stock Should Value Investors Buy Now?

Read MoreHide Full Article

Investors looking for stocks in the Internet - Content sector might want to consider either Perion Network (PERI - Free Report) or Brightcove (BCOV - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, Perion Network has a Zacks Rank of #1 (Strong Buy), while Brightcove has a Zacks Rank of #2 (Buy). This means that PERI's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst 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 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.

PERI currently has a forward P/E ratio of 16.36, while BCOV has a forward P/E of 142.27. We also note that PERI has a PEG ratio of 2.73. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BCOV currently has a PEG ratio of 9.48.

Another notable valuation metric for PERI is its P/B ratio of 1.07. 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, BCOV has a P/B of 6.55.

These metrics, and several others, help PERI earn a Value grade of A, while BCOV has been given a Value grade of D.

PERI stands above BCOV thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PERI is the superior value option right now.


See More Zacks Research for These Tickers


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


Brightcove Inc. (BCOV) - free report >>

Perion Network Ltd (PERI) - free report >>

Published in