Investors interested in Outsourcing stocks are likely familiar with Genpact (G) and Paychex (PAYX). But which of these two stocks presents investors with the better value opportunity right now? 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, Genpact is sporting a Zacks Rank of #2 (Buy), while Paychex has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that G likely has seen a stronger improvement to its earnings outlook than PAYX has recently. But this is only part of the picture for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

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.

G currently has a forward P/E ratio of 13.90, while PAYX has a forward P/E of 28.70. We also note that G has a PEG ratio of 1.41. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. PAYX currently has a PEG ratio of 3.93.

Another notable valuation metric for G is its P/B ratio of 3.33. 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, PAYX has a P/B of 13.36.

Based on these metrics and many more, G holds a Value grade of A, while PAYX has a Value grade of D.

G stands above PAYX thanks to its solid earnings outlook, and based on these valuation figures, we also feel that G is the superior value option right now.

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Genpact Limited (G) : Free Stock Analysis Report

Paychex, Inc. (PAYX) : Free Stock Analysis Report

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