CVET vs. CRWD: Which Stock Should Value Investors Buy Now?
Investors with an interest in Internet - Software stocks have likely encountered both Covetrus (CVET) and CrowdStrike Holdings (CRWD). 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.
Covetrus and CrowdStrike Holdings are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that CVET's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
CVET currently has a forward P/E ratio of 40.79, while CRWD has a forward P/E of 2,124.32. We also note that CVET has a PEG ratio of 1.29. 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. CRWD currently has a PEG ratio of 84.97.
Another notable valuation metric for CVET is its P/B ratio of 2.40. 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, CRWD has a P/B of 37.28.
These metrics, and several others, help CVET earn a Value grade of B, while CRWD has been given a Value grade of F.
CVET has seen stronger estimate revision activity and sports more attractive valuation metrics than CRWD, so it seems like value investors will conclude that CVET is the superior option right now.
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Covetrus, Inc. (CVET) : Free Stock Analysis Report
CrowdStrike Holdings Inc. (CRWD) : Free Stock Analysis Report
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