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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.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.

Right now, Perion Network is sporting a Zacks Rank of #1 (Strong Buy), while Brightcove has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that PERI is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

PERI currently has a forward P/E ratio of 14.11, while BCOV has a forward P/E of 40.29. We also note that PERI has a PEG ratio of 2.35. 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 2.69.

Another notable valuation metric for PERI is its P/B ratio of 1.27. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, BCOV has a P/B of 4.49.

Based on these metrics and many more, PERI holds a Value grade of A, while BCOV has a Value grade of D.

PERI sticks out from BCOV in both our Zacks Rank and Style Scores models, so value investors will likely feel that PERI is the better option right now.


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