CACI vs. FORR: Which Stock Is the Better Value Option?
Investors interested in Computer - Services stocks are likely familiar with CACI International (CACI) and Forrester Research (FORR). 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.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
CACI International and Forrester Research are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that CACI's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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 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.
CACI currently has a forward P/E ratio of 16.49, while FORR has a forward P/E of 27.01. We also note that CACI has a PEG ratio of 1.57. 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. FORR currently has a PEG ratio of 2.25.
Another notable valuation metric for CACI is its P/B ratio of 2.20. 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, FORR has a P/B of 4.32.
These metrics, and several others, help CACI earn a Value grade of A, while FORR has been given a Value grade of C.
CACI has seen stronger estimate revision activity and sports more attractive valuation metrics than FORR, so it seems like value investors will conclude that CACI is the superior option right now.
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CACI International, Inc. (CACI) : Free Stock Analysis Report
Forrester Research, Inc. (FORR) : Free Stock Analysis Report
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