Investors looking for stocks in the Internet - Content sector might want to consider either Tencent Music Entertainment Group Sponsored ADR (TME) or TechTarget (TTGT). But which of these two stocks presents investors with the better value opportunity right now? Let's 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Tencent Music Entertainment Group Sponsored ADR has a Zacks Rank of #2 (Buy), while TechTarget has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that TME has an improving earnings outlook. But this is only part of the picture 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.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

TME currently has a forward P/E ratio of 17.32, while TTGT has a forward P/E of 18.32. We also note that TME has a PEG ratio of 0.80. 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. TTGT currently has a PEG ratio of 10.29.

Another notable valuation metric for TME is its P/B ratio of 2.34. 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, TTGT has a P/B of 3.57.

These are just a few of the metrics contributing to TME's Value grade of B and TTGT's Value grade of D.

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

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Tencent Music Entertainment Group Sponsored ADR (TME) : Free Stock Analysis Report

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