TASK or DT: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Computers - IT Services sector might want to consider either TaskUs (TASK) or Dynatrace (DT). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, TaskUs is sporting a Zacks Rank of #2 (Buy), while Dynatrace has a Zacks Rank of #3 (Hold). This means that TASK's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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.
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.
TASK currently has a forward P/E ratio of 13.27, while DT has a forward P/E of 48.08. We also note that TASK has a PEG ratio of 0.89. 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. DT currently has a PEG ratio of 2.47.
Another notable valuation metric for TASK is its P/B ratio of 4.19. 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, DT has a P/B of 8.14.
These metrics, and several others, help TASK earn a Value grade of B, while DT has been given a Value grade of D.
TASK is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that TASK is likely the superior value option right now.
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TaskUs, Inc. (TASK) : Free Stock Analysis Report
Dynatrace, Inc. (DT) : Free Stock Analysis Report
