Should Value Investors Buy DHI Group (DHX) Stock?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
DHI Group (DHX) is a stock many investors are watching right now. DHX is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.
Investors will also notice that DHX has a PEG ratio of 0.86. 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. DHX's PEG compares to its industry's average PEG of 1.24. Over the past 52 weeks, DHX's PEG has been as high as 3.51 and as low as 0.82, with a median of 1.54.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. DHX has a P/S ratio of 0.81. This compares to its industry's average P/S of 1.11.
If you're looking for another solid Internet - Content value stock, take a look at Weibo (WB). WB is a # 2 (Buy) stock with a Value score of A.
Weibo is currently trading with a Forward P/E ratio of 5.47 while its PEG ratio sits at 0.97. Both of the company's metrics compare favorably to its industry's average P/E of 19.81 and average PEG ratio of 1.24.
WB's price-to-earnings ratio has been as high as 11.11 and as low as 4.30, with a median of 6.75, while its PEG ratio has been as high as 1.06 and as low as 0.37, with a median of 0.65, all within the past year.
Additionally, Weibo has a P/B ratio of 0.91 while its industry's price-to-book ratio sits at 7.43. For WB, this valuation metric has been as high as 1.78, as low as 0.78, with a median of 1.08 over the past year.
Value investors will likely look at more than just these metrics, but the above data helps show that DHI Group and Weibo are likely undervalued currently. And when considering the strength of its earnings outlook, DHX and WB sticks out as one of the market's strongest value stocks.
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DHI Group, Inc. (DHX) : Free Stock Analysis Report
Weibo Corporation (WB) : Free Stock Analysis Report
