Investors looking for stocks in the Outsourcing sector might want to consider either Genpact (G) or Paychex (PAYX). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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

Genpact and Paychex are both sporting a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. 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.

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.

G currently has a forward P/E ratio of 13.08, while PAYX has a forward P/E of 27.68. We also note that G has a PEG ratio of 1.33. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. PAYX currently has a PEG ratio of 3.79.

Another notable valuation metric for G is its P/B ratio of 3.15. 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, PAYX has a P/B of 12.63.

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

Both G and PAYX 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

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

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