HPE or ZI: Which Is the Better Value Stock Right Now?
Investors interested in Computer - Integrated Systems stocks are likely familiar with Hewlett Packard Enterprise (HPE) and ZoomInfo (ZI). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, Hewlett Packard Enterprise is sporting a Zacks Rank of #2 (Buy), while ZoomInfo 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 HPE is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
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 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.
HPE currently has a forward P/E ratio of 8.05, while ZI has a forward P/E of 25.82. We also note that HPE has a PEG ratio of 1.71. 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. ZI currently has a PEG ratio of 1.78.
Another notable valuation metric for HPE is its P/B ratio of 1.07. 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, ZI has a P/B of 4.48.
Based on these metrics and many more, HPE holds a Value grade of A, while ZI has a Value grade of D.
HPE stands above ZI thanks to its solid earnings outlook, and based on these valuation figures, we also feel that HPE is the superior value option right now.
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Hewlett Packard Enterprise Company (HPE) : Free Stock Analysis Report
ZoomInfo Technologies Inc. (ZI) : Free Stock Analysis Report
