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TTEC vs. ADP: Which Stock Should Value Investors Buy Now?

BOJA vs. SBUX: Which Stock Is the Better Value Option?

Investors interested in stocks from the Outsourcing sector have probably already heard of TTEC Holdings (TTEC) and Automatic Data Processing (ADP). 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Both TTEC Holdings and Automatic Data Processing have 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. 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 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.

TTEC currently has a forward P/E ratio of 18.60, while ADP has a forward P/E of 32.27. We also note that TTEC has a PEG ratio of 2.33. 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. ADP currently has a PEG ratio of 2.85.

Another notable valuation metric for TTEC is its P/B ratio of 4.87. 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, ADP has a P/B of 15.38.

Based on these metrics and many more, TTEC holds a Value grade of A, while ADP has a Value grade of D.

Both TTEC and ADP are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that TTEC is the superior value option right now.


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TeleTech Holdings, Inc. (TTEC) : Free Stock Analysis Report
 
Automatic Data Processing, Inc. (ADP) : Free Stock Analysis Report
 
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