Investors looking for stocks in the Outsourcing sector might want to consider either Genpact (G) or ExlService Holdings (EXLS). 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.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, both Genpact and ExlService Holdings are holding 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 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.

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.

G currently has a forward P/E ratio of 12.50, while EXLS has a forward P/E of 23.56. We also note that G has a PEG ratio of 1.49. 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. EXLS currently has a PEG ratio of 1.58.

Another notable valuation metric for G is its P/B ratio of 3.04. 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, EXLS has a P/B of 7.21.

These metrics, and several others, help G earn a Value grade of A, while EXLS has been given a Value grade of C.

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

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Genpact Limited (G) : Free Stock Analysis Report

ExlService Holdings, Inc. (EXLS) : Free Stock Analysis Report

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