Back to top

Image: Bigstock

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

Read MoreHide Full Article

Investors interested in stocks from the Internet - Content sector have probably already heard of Perion Network (PERI) and Brightcove (BCOV - 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, Perion Network has a Zacks Rank of #2 (Buy), while Brightcove 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 PERI has an improving earnings outlook. But this is just one piece of the puzzle 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.

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 13.15, while BCOV has a forward P/E of 115.15. We also note that PERI has a PEG ratio of 2.19. 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. BCOV currently has a PEG ratio of 7.68.

Another notable valuation metric for PERI is its P/B ratio of 0.86. 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 5.30.

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

PERI is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that PERI is likely the superior value option right now.


In-Depth Zacks Research for the Tickers Above


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


Brightcove Inc. (BCOV) - free report >>

Published in