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KT vs. CRNT: Which Stock Should Value Investors Buy Now?

Zacks Equity Research
·2-min read

Investors looking for stocks in the Wireless Non-US sector might want to consider either KT Corp. (KT) or Ceragon Networks (CRNT). 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.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. 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.

Right now, KT Corp. is sporting a Zacks Rank of #2 (Buy), while Ceragon Networks has a Zacks Rank of #3 (Hold). This means that KT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

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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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.

KT currently has a forward P/E ratio of 7.08, while CRNT has a forward P/E of 139.50. We also note that KT has a PEG ratio of 0.83. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. CRNT currently has a PEG ratio of 9.30.

Another notable valuation metric for KT is its P/B ratio of 0.41. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, CRNT has a P/B of 3.01.

These metrics, and several others, help KT earn a Value grade of A, while CRNT has been given a Value grade of D.

KT has seen stronger estimate revision activity and sports more attractive valuation metrics than CRNT, so it seems like value investors will conclude that KT is the superior option right now.


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KT Corporation (KT) : Free Stock Analysis Report
 
Ceragon Networks Ltd. (CRNT) : Free Stock Analysis Report
 
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Zacks Investment Research