Investors with an interest in Technology Services stocks have likely encountered both NV5 Global (NVEE) and Amplitude, Inc. (AMPL). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
NV5 Global and Amplitude, Inc. are both sporting 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. But this is only part of the picture for value investors.
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 grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
NVEE currently has a forward P/E ratio of 17.59, while AMPL has a forward P/E of 171.07. We also note that NVEE has a PEG ratio of 1.47. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. AMPL currently has a PEG ratio of 4.12.
Another notable valuation metric for NVEE is its P/B ratio of 1.81. 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, AMPL has a P/B of 4.18.
Based on these metrics and many more, NVEE holds a Value grade of B, while AMPL has a Value grade of F.
Both NVEE and AMPL are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that NVEE is the superior value option right now.
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NV5 Global, Inc. (NVEE): Free Stock Analysis Report Amplitude, Inc. (AMPL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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