J vs. AMPL: Which Stock Is the Better Value Option?

Zacks
09 Apr

Investors interested in Technology Services stocks are likely familiar with Jacobs Solutions (J) and Amplitude, Inc. (AMPL). 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, Jacobs Solutions is sporting a Zacks Rank of #2 (Buy), while Amplitude, Inc. has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that J is likely seeing its earnings outlook improve to a greater extent. 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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

J currently has a forward P/E ratio of 18.33, while AMPL has a forward P/E of 121.14. We also note that J has a PEG ratio of 1.56. 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. AMPL currently has a PEG ratio of 3.13.

Another notable valuation metric for J is its P/B ratio of 3.21. 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, AMPL has a P/B of 3.69.

Based on these metrics and many more, J holds a Value grade of B, while AMPL has a Value grade of F.

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

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Jacobs Solutions Inc. (J) : Free Stock Analysis Report

Amplitude, Inc. (AMPL) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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