PYPL or BL: Which Is the Better Value Stock Right Now?
Investors interested in Internet - Software stocks are likely familiar with Paypal (PYPL) and BlackLine (BL). But which of these two companies is the best option for those looking for undervalued stocks? 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Paypal and BlackLine are both sporting a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle for value investors.
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.
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.
PYPL currently has a forward P/E ratio of 18.08, while BL has a forward P/E of 152.96. We also note that PYPL has a PEG ratio of 1.15. 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. BL currently has a PEG ratio of 8.98.
Another notable valuation metric for PYPL is its P/B ratio of 4.15. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, BL has a P/B of 53.13.
These are just a few of the metrics contributing to PYPL's Value grade of B and BL's Value grade of D.
Both PYPL and BL are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that PYPL is the superior value option right now.
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PayPal Holdings, Inc. (PYPL) : Free Stock Analysis Report
BlackLine (BL) : Free Stock Analysis Report
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