HSON vs. EXLS: Which Stock Is the Better Value Option?
Investors looking for stocks in the Outsourcing sector might want to consider either Hudson Global (HSON) or ExlService Holdings (EXLS). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, both Hudson Global and ExlService Holdings are sporting a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. But this is only part of the picture 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.
HSON currently has a forward P/E ratio of 7.62, while EXLS has a forward P/E of 23.61. We also note that HSON has a PEG ratio of 0.38. 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. EXLS currently has a PEG ratio of 1.62.
Another notable valuation metric for HSON is its P/B ratio of 1.48. 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, EXLS has a P/B of 6.97.
Based on these metrics and many more, HSON holds a Value grade of A, while EXLS has a Value grade of C.
Both HSON and EXLS are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that HSON is the superior value option right now.
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Hudson Global, Inc. (HSON) : Free Stock Analysis Report
ExlService Holdings, Inc. (EXLS) : Free Stock Analysis Report
