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

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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 presents investors with the better value opportunity right now? 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Perion Network has a Zacks Rank of #1 (Strong Buy), while Brightcove 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 PERI has an improving earnings outlook. However, value investors will care about much more than just this.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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 11.80, while BCOV has a forward P/E of 116.31. We also note that PERI has a PEG ratio of 1.97. 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. BCOV currently has a PEG ratio of 7.75.

Another notable valuation metric for PERI is its P/B ratio of 0.77. 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 5.35.

These are just a few of the metrics contributing to PERI's Value grade of A and BCOV's Value grade of F.

PERI has seen stronger estimate revision activity and sports more attractive valuation metrics than BCOV, so it seems like value investors will conclude that PERI is the superior option right now.


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