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SAIC or CSGP: Which Is the Better Value Stock Right Now?

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Investors interested in Computers - IT Services stocks are likely familiar with SAIC (SAIC - Free Report) and CoStar Group (CSGP - 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, SAIC is sporting a Zacks Rank of #2 (Buy), while CoStar Group has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that SAIC likely has seen a stronger improvement to its earnings outlook than CSGP has recently. But this is just one piece of the puzzle for value investors.

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.

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.

SAIC currently has a forward P/E ratio of 11.48, while CSGP has a forward P/E of 51.59. We also note that SAIC has a PEG ratio of 2.30. 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. CSGP currently has a PEG ratio of 3.44.

Another notable valuation metric for SAIC is its P/B ratio of 2.88. 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, CSGP has a P/B of 5.67.

Based on these metrics and many more, SAIC holds a Value grade of B, while CSGP has a Value grade of F.

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


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CoStar Group, Inc. (CSGP) - free report >>

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