Investors looking for stocks in the Computer - Peripheral Equipment sector might want to consider either LG Display (LPL) or Logitech (LOGI). 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.
Currently, LG Display has a Zacks Rank of #2 (Buy), while Logitech has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that LPL has an improving earnings outlook. But this is just one factor that value investors are interested in.
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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
LPL currently has a forward P/E ratio of 6.92, while LOGI has a forward P/E of 22.10. We also note that LPL has a PEG ratio of 0.26. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. LOGI currently has a PEG ratio of 3.52.
Another notable valuation metric for LPL is its P/B ratio of 0.93. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, LOGI has a P/B of 8.05.
These metrics, and several others, help LPL earn a Value grade of A, while LOGI has been given a Value grade of C.
LPL sticks out from LOGI in both our Zacks Rank and Style Scores models, so value investors will likely feel that LPL is the better option right now.
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LG Display Co., Ltd. (LPL): Free Stock Analysis Report Logitech International S.A. (LOGI): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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