ALOT vs. DOCU: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Technology Services sector have probably already heard of AstroNova (ALOT) and DocuSign (DOCU). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.
Currently, AstroNova has a Zacks Rank of #2 (Buy), while DocuSign has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that ALOT likely has seen a stronger improvement to its earnings outlook than DOCU 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 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.
ALOT currently has a forward P/E ratio of 46.44, while DOCU has a forward P/E of 162.80. We also note that ALOT has a PEG ratio of 3.87. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. DOCU currently has a PEG ratio of 4.21.
Another notable valuation metric for ALOT is its P/B ratio of 1.52. 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, DOCU has a P/B of 127.50.
These are just a few of the metrics contributing to ALOT's Value grade of B and DOCU's Value grade of F.
ALOT stands above DOCU thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ALOT is the superior value option right now.
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AstroNova, Inc. (ALOT) : Free Stock Analysis Report
DocuSign Inc. (DOCU) : Free Stock Analysis Report
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