NVEE vs. ACN: Which Stock Should Investors Buy Now? – September 17, 2021
Investors interested in advisory services stocks are likely familiar with NV5 Holdings (NVEE – Free report) and Accenture (ACN – Free report). But which of these two stocks is offering better value for value investors right now? We will have to take a closer look.
There are many strategies for discovering value stocks, but we’ve found that pairing a strong Zacks ranking with an impressive rating in the Value category of our style scoring system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our style scores highlight companies with specific characteristics.
NV5 Holdings and Accenture are ranked 2 (Buy) and 3 (Hold) respectively for Zacks. Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors need to be assured that NVEE has an improving earnings outlook. But that’s only part of the picture for value investors.
Value investors also try to analyze a wide range of traditional numbers and metrics to help determine if a company is undervalued at its current stock price level.
Our Value category ranks stocks based on a number of key metrics including proven P / E ratio, P / S ratio, earnings performance and cash flow per share, as well as various other fundamentals that value investors frequently use.
NVEE currently has a forward P / E ratio of 23.14, while ACN has a forward P / E of 34.79. We also note that NVEE has a PEG ratio of 1.44. This metric is used similarly to the famous P / E ratio, but the PEG ratio also takes into account the expected growth rate of the stock’s earnings. ACN currently has a PEG ratio of 3.48.
Another notable valuation metric for NVEE is its P / N ratio of 2.63. The P / B ratio is used to compare the market value of a stock with its book value, which is defined as total assets minus total liabilities. For comparison, ACN has a P / B of 10.92.
Based on these metrics and many others, NVEE has a value rating of B, while ACN has a value rating of C.
NVEE sits above ACN thanks to its strong earnings outlook, and based on these valuation numbers, we also believe NVEE is the top value option right now.