Investors interested in Computer - Services stocks are likely familiar with CACI International (CACI) and CGI Group (GIB). 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 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.
CACI International has a Zacks Rank of #2 (Buy), while CGI Group has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that CACI likely has seen a stronger improvement to its earnings outlook than GIB has recently. But this is just one factor that value investors are interested in.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
CACI currently has a forward P/E ratio of 20.05, while GIB has a forward P/E of 20.41. We also note that CACI has a PEG ratio of 1.94. 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. GIB currently has a PEG ratio of 2.63.
Another notable valuation metric for CACI is its P/B ratio of 3.06. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, GIB has a P/B of 4.01.
These are just a few of the metrics contributing to CACI's Value grade of B and GIB's Value grade of C.
CACI has seen stronger estimate revision activity and sports more attractive valuation metrics than GIB, so it seems like value investors will conclude that CACI is the superior option right now.
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Today, See These 5 Potential Home Runs >>CACI International, Inc. (CACI) : Free Stock Analysis Report
CGI Group, Inc. (GIB) : Free Stock Analysis Report
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