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

Zacks Equity Research
·2-min read

Investors with an interest in Electronics - Semiconductors stocks have likely encountered both ASE Technology Hldg (ASX) and Ceva (CEVA). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, both ASE Technology Hldg and Ceva are sporting a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle 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.

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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.

ASX currently has a forward P/E ratio of 11.46, while CEVA has a forward P/E of 77.30. We also note that ASX has a PEG ratio of 0.43. 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. CEVA currently has a PEG ratio of 3.86.

Another notable valuation metric for ASX is its P/B ratio of 1.27. 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, CEVA has a P/B of 3.10.

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

Both ASX and CEVA are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that ASX is the superior value option right now.


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Advanced Semiconductor Engineering, Inc. (ASX) : Free Stock Analysis Report
 
CEVA, Inc. (CEVA) : Free Stock Analysis Report
 
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