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IDCC or MSI: Which Is the Better Value Stock Right Now?
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Investors interested in stocks from the Wireless Equipment sector have probably already heard of InterDigital (IDCC - Free Report) and Motorola (MSI - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
Right now, InterDigital is sporting a Zacks Rank of #1 (Strong Buy), while Motorola has a Zacks Rank of #4 (Sell). Investors should feel comfortable knowing that IDCC likely has seen a stronger improvement to its earnings outlook than MSI has recently. 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
IDCC currently has a forward P/E ratio of 15.99, while MSI has a forward P/E of 34.14. We also note that IDCC has a PEG ratio of 0.92. 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. MSI currently has a PEG ratio of 3.51.
Another notable valuation metric for IDCC is its P/B ratio of 5.76. 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, MSI has a P/B of 92.69.
Based on these metrics and many more, IDCC holds a Value grade of B, while MSI has a Value grade of D.
IDCC has seen stronger estimate revision activity and sports more attractive valuation metrics than MSI, so it seems like value investors will conclude that IDCC is the superior option right now.
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IDCC or MSI: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Wireless Equipment sector have probably already heard of InterDigital (IDCC - Free Report) and Motorola (MSI - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
Right now, InterDigital is sporting a Zacks Rank of #1 (Strong Buy), while Motorola has a Zacks Rank of #4 (Sell). Investors should feel comfortable knowing that IDCC likely has seen a stronger improvement to its earnings outlook than MSI has recently. 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
IDCC currently has a forward P/E ratio of 15.99, while MSI has a forward P/E of 34.14. We also note that IDCC has a PEG ratio of 0.92. 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. MSI currently has a PEG ratio of 3.51.
Another notable valuation metric for IDCC is its P/B ratio of 5.76. 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, MSI has a P/B of 92.69.
Based on these metrics and many more, IDCC holds a Value grade of B, while MSI has a Value grade of D.
IDCC has seen stronger estimate revision activity and sports more attractive valuation metrics than MSI, so it seems like value investors will conclude that IDCC is the superior option right now.