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CDW vs. CYBR: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Computers - IT Services sector might want to consider either CDW (CDW - Free Report) or CyberArk (CYBR - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, CDW has a Zacks Rank of #2 (Buy), while CyberArk has a Zacks Rank of #3 (Hold). This means that CDW'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.

CDW currently has a forward P/E ratio of 20.21, while CYBR has a forward P/E of 105.03. We also note that CDW has a PEG ratio of 5.10. 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. CYBR currently has a PEG ratio of 5.25.

Another notable valuation metric for CDW is its P/B ratio of 11.31. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, CYBR has a P/B of 13.32.

These metrics, and several others, help CDW earn a Value grade of B, while CYBR has been given a Value grade of F.

CDW has seen stronger estimate revision activity and sports more attractive valuation metrics than CYBR, so it seems like value investors will conclude that CDW is the superior option right now.


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