Investors interested in Internet - Commerce stocks are likely familiar with Prosus N.V. Sponsored ADR (PROSY) and CarGurus (CARG). 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.
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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Prosus N.V. Sponsored ADR and CarGurus are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that PROSY is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.
PROSY currently has a forward P/E ratio of 2.91, while CARG has a forward P/E of 11.47. We also note that PROSY has a PEG ratio of 0.16. 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. CARG currently has a PEG ratio of 0.88.
Another notable valuation metric for PROSY is its P/B ratio of 5.27. 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, CARG has a P/B of 7.3.
These metrics, and several others, help PROSY earn a Value grade of A, while CARG has been given a Value grade of C.
PROSY sticks out from CARG in both our Zacks Rank and Style Scores models, so value investors will likely feel that PROSY is the better option right now.
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Prosus N.V. Sponsored ADR (PROSY): Free Stock Analysis Report CarGurus, Inc. (CARG): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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