PSFE or FOUR: Which Is the Better Value Stock Right Now?
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Investors looking for stocks in the Financial Transaction Services sector might want to consider either Paysafe Limited (PSFE) or Shift4 Payments (FOUR). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.
Paysafe Limited and Shift4 Payments are sporting Zacks Ranks of #1 (Strong Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that PSFE has an improving earnings outlook. But this is only part of the picture for value investors.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
PSFE currently has a forward P/E ratio of 8.80, while FOUR has a forward P/E of 24.19. We also note that PSFE has a PEG ratio of 0.42. 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. FOUR currently has a PEG ratio of 0.81.
Another notable valuation metric for PSFE is its P/B ratio of 1.55. 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, FOUR has a P/B of 8.58.
These are just a few of the metrics contributing to PSFE's Value grade of A and FOUR's Value grade of C.
PSFE stands above FOUR thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PSFE is the superior value option right now.
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Paysafe Limited (PSFE) : Free Stock Analysis Report
Shift4 Payments, Inc. (FOUR) : Free Stock Analysis Report