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III vs. FC: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Consulting Services sector might want to consider either Information Services Group (III) or Franklin Covey (FC). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, Information Services Group has a Zacks Rank of #2 (Buy), while Franklin Covey has a Zacks Rank of #3 (Hold). This means that III's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

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 grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

III currently has a forward P/E ratio of 19.38, while FC has a forward P/E of 77.98. We also note that III has a PEG ratio of 1.11. 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. FC currently has a PEG ratio of 3.12.

Another notable valuation metric for III is its P/B ratio of 3.62. 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, FC has a P/B of 7.79.

These metrics, and several others, help III earn a Value grade of B, while FC has been given a Value grade of C.

III sticks out from FC in both our Zacks Rank and Style Scores models, so value investors will likely feel that III is the better option right now.


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Information Services Group, Inc. (III) : Free Stock Analysis Report
 
Franklin Covey Company (FC) : Free Stock Analysis Report
 
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