Advertisement
UK markets closed

  • FTSE 100

    8,139.83
    +60.97 (+0.75%)
     

  • FTSE 250

    19,824.16
    +222.18 (+1.13%)
     

  • AIM

    755.28
    +2.16 (+0.29%)
     

  • GBP/EUR

    1.1681
    +0.0024 (+0.21%)
     

  • GBP/USD

    1.2495
    -0.0016 (-0.13%)
     

  • Bitcoin GBP

    51,183.25
    -490.82 (-0.95%)
     

  • CMC Crypto 200

    1,329.96
    -66.57 (-4.77%)
     

  • S&P 500

    5,099.96
    +51.54 (+1.02%)
     

  • DOW

    38,239.66
    +153.86 (+0.40%)
     

  • CRUDE OIL

    83.68
    +0.11 (+0.13%)
     

  • GOLD FUTURES

    2,351.50
    +9.00 (+0.38%)
     

  • NIKKEI 225

    37,934.76
    +306.28 (+0.81%)
     

  • HANG SENG

    17,651.15
    +366.61 (+2.12%)
     

  • DAX

    18,161.01
    +243.73 (+1.36%)
     

  • CAC 40

    8,088.24
    +71.59 (+0.89%)
     
PROPERTY:

9 luxury homes to consider if money is no object

Ever thought about what a multimillion pound budget would buy you?

ASX vs. AMBA: Which Stock Should Value Investors Buy Now?

Zacks Equity Research
·2-min read

Investors interested in Electronics - Semiconductors stocks are likely familiar with ASE Technology Hldg (ASX) and Ambarella (AMBA). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

ASE Technology Hldg has a Zacks Rank of #2 (Buy), while Ambarella has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that ASX likely has seen a stronger improvement to its earnings outlook than AMBA has recently. But this is just one piece of the puzzle for value investors.

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.

ADVERTISEMENT

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.

ASX currently has a forward P/E ratio of 12.83, while AMBA has a forward P/E of 114.73. We also note that ASX has a PEG ratio of 4.24. 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. AMBA currently has a PEG ratio of 8.04.

Another notable valuation metric for ASX is its P/B ratio of 1.44. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, AMBA has a P/B of 3.49.

Based on these metrics and many more, ASX holds a Value grade of A, while AMBA has a Value grade of F.

ASX sticks out from AMBA in both our Zacks Rank and Style Scores models, so value investors will likely feel that ASX is the better option right now.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Advanced Semiconductor Engineering, Inc. (ASX) : Free Stock Analysis Report
 
Ambarella, Inc. (AMBA) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.