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SIFY vs. SHOP: Which Stock Should Value Investors Buy Now?

SIFY vs. SHOP: Which Stock Is the Better Value Option?

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This story originally appeared on Zacks

Investors interested in stocks from the Internet - Services sector have probably already heard of Sify Technologies Limited (SIFY) and Shopify (SHOP). 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.

- Zacks

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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.

Sify Technologies Limited and Shopify are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that SIFY likely has seen a stronger improvement to its earnings outlook than SHOP has recently. 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 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.

SIFY currently has a forward P/E ratio of 23.31, while SHOP has a forward P/E of 219.03. We also note that SIFY has a PEG ratio of 1.17. 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. SHOP currently has a PEG ratio of 6.80.

Another notable valuation metric for SIFY is its P/B ratio of 2.96. 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, SHOP has a P/B of 15.37.

These are just a few of the metrics contributing to SIFY's Value grade of A and SHOP's Value grade of F.

SIFY stands above SHOP thanks to its solid earnings outlook, and based on these valuation figures, we also feel that SIFY is the superior value option right now.



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Sify Technologies Limited (SIFY): Free Stock Analysis Report

 

Shopify Inc. (SHOP): Free Stock Analysis Report

 

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