Investors interested in stocks from the Technology Services sector have probably already heard of Qifu Technology, Inc. (QFIN) and Climb Global Solutions (CLMB). 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.
Right now, Qifu Technology, Inc. is sporting a Zacks Rank of #1 (Strong Buy), while Climb Global Solutions has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that QFIN has an improving earnings outlook. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
QFIN currently has a forward P/E ratio of 5.79, while CLMB has a forward P/E of 27.90. We also note that QFIN has a PEG ratio of 0.28. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. CLMB currently has a PEG ratio of 1.74.
Another notable valuation metric for QFIN is its P/B ratio of 1.79. 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, CLMB has a P/B of 6.67.
Based on these metrics and many more, QFIN holds a Value grade of A, while CLMB has a Value grade of C.
QFIN has seen stronger estimate revision activity and sports more attractive valuation metrics than CLMB, so it seems like value investors will conclude that QFIN is the superior option right now.
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Climb Global Solutions, Inc. (CLMB) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
