Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 7 stocks made the list for top value stocks in the Business Support Services industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Business Support Services Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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7 Undervalued Business Support Services Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 7 undervalued stocks in the Business Support Services industry for Monday, July 01, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Business Support Services industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Emerald Holding Inc’s Value Grade

Value Grade:

Emerald Holding, Inc. is an operator of business-to-business (B2B) trade shows in the United States. The Company integrates live events, media content, industry insights, digital tools, data-focused solutions and e-commerce platforms into three complementary business lines: Connections, Content and Commerce. Its segments include Connections, All Other and Corporate-Level Activity. The Connections division includes a collection of B2B trade show franchises, which typically hold positions within their respective industry verticals. The Content division includes B2B print publications and digital media products that complement its existing trade show properties. These print and digital media products provide industry-specific business news and information across 20 sectors. The Commerce division offers B2B e-commerce and digital merchandising solutions, serving the needs of manufacturers and retailers through its Elastic Suite and Bulletin platforms.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Emerald Holding Inc has a Value Score of 91, which is considered to be undervalued.

When you look at Emerald Holding Inc’s price-to-sales ratio at 0.91 compared to the industry median at 1.74, this company has a lower price relative to revenue compared to its peers. This could make Emerald Holding Inc’s stock more attractive for value investors.

Now, let’s assess Emerald Holding Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 6.9, when compared to the industry median of 11.7, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Emerald Holding Inc’s shareholder yield is higher than its industry median ratio of 0.00%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Emerald Holding Inc’s price-to-book ratio is lower than its industry median ratio of 2.77. This could make Emerald Holding Inc more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Emerald Holding Inc’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Emerald Holding Inc’s price-to-free-cash-flow ratio is lower than its industry median ratio of 16.83. This could make Emerald Holding Inc more attractive because the lower P/FCF ratio indicates that Emerald Holding Inc is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

PagSeguro Digital Ltd’s Value Grade

Value Grade:

PagSeguro Digital Ltd. is a disruptive provider of financial technology solutions focused primarily on consumers, individual entrepreneurs, micro-merchants, small companies, and medium-sized companies in Brazil. Its end-to-end digital ecosystem enables its merchants not only to accept payments, but also to grow and manage their businesses. It offers a two-sided ecosystem, providing banking and payments experience through a single interface, with one app, one platform and one customer support. Its digital banking ecosystem features its free PagBank digital account, under the brand PagBank, and offers about 40 cash-in methods and 13 cash-out options. Focusing primarily on individual entrepreneurs, micro-merchants, and small and medium-sized enterprises (SMEs), the Company offer a range of POS and mPOS devices specifically designed to fit their business needs. The Company’s end-to-end payments ecosystem enables its customers to accept a range of online and in-person payment methods.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

PagSeguro Digital Ltd has a Value Score of 87, which is considered to be undervalued.

PagSeguro Digital Ltd’s price-earnings ratio is 11.7 compared to the industry median at 23.0. This means that it has a lower price relative to its earnings compared to its peers. This makes PagSeguro Digital Ltd more attractive for value investors.

PagSeguro Digital Ltd’s price-to-book ratio is higher than its peers. This could make PagSeguro Digital Ltd less attractive for value investors when compared to the industry median at 2.77.

You can read more about PagSeguro Digital Ltd’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Pharma-Bio Serv Inc’s Value Grade

Value Grade:

Pharma-Bio Serv, Inc. is a compliance and technology transfer services consulting company. The Company operates through four segments: Puerto Rico technical compliance consulting, United States technical compliance consulting, Europe technical compliance consulting, and Puerto Rico microbiological and chemical laboratory testing division (Lab). The Company provides a range of compliance-related consulting services. The Company provides microbiological testing services and chemical testing services through its laboratory testing facility in Puerto Rico. The Company's technical consulting services include regulatory compliance, validation, technology transfer, engineering, project management and process support. The Company markets its services to pharmaceutical, chemical, biotechnology, medical devices, cosmetic and food industries, and allied products companies in Puerto Rico, the United States, Europe and Brazil.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Pharma-Bio Serv Inc has a Value Score of 70, which is considered to be undervalued.

Pharma-Bio Serv Inc’s price-to-book ratio is higher than its peers. This could make Pharma-Bio Serv Inc less attractive for value investors when compared to the industry median at 2.77.

You can read more about Pharma-Bio Serv Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Resources Connection Inc’s Value Grade

Value Grade:

Resources Connection, Inc. is a global consulting company. The Company operates through two segments: Resources Global Professionals (RGP) and Sitrick. RGP segment is a global business consulting firm focused on project execution services that power clients’ operational needs and change initiatives with experienced and diverse talent. Sitrick segment is a crisis communications and public relations firm, which operates under the Sitrick brand, providing corporate, financial, transactional and crisis communication and management services. The Company serves its clients in support of projects and initiatives in an array of functional areas, including transactions, which includes integration and divestitures, bankruptcy/restructuring, going public readiness and support, financial process optimization, and system implementation; regulations, which includes accounting regulations, internal audit and compliance, and other, and transformations, which include finance transformation and other.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Resources Connection Inc has a Value Score of 80, which is considered to be undervalued.

Resources Connection Inc’s price-earnings ratio is 16.8 compared to the industry median at 23.0. This means that it has a lower price relative to its earnings compared to its peers. This makes Resources Connection Inc more attractive for value investors.

Resources Connection Inc’s price-to-book ratio is higher than its peers. This could make Resources Connection Inc less attractive for value investors when compared to the industry median at 2.77.

You can read more about Resources Connection Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Starbox Group Holdings Ltd’s Value Grade

Value Grade:

Starbox Group Holdings Ltd. is engaged in building a cash rebate, advertising, payment solution, and software licensing business ecosystem targeting micro, small, and medium enterprises. Its segments include Cash rebate, payment solution, and media booking; Advertising services; Software licensing; Production services, and Marketing and Promotional campaign services. Through its subsidiaries in Malaysia, the Company connects retail merchants with retail shoppers to facilitate transactions through cash rebates offered by retail merchants, provides digital advertising services to advertisers, provides payment solution services to merchants, and license customized software systems to its clients. The Company cooperates with retail merchants, which have registered on the GETBATS Website and mobile app as merchants, to offer cash rebates on their products or services. It primarily distributes advertisements through its SEEBATS and GETBATS websites and mobile applications to its members.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Starbox Group Holdings Ltd has a Value Score of 87, which is considered to be undervalued.

Starbox Group Holdings Ltd’s price-earnings ratio is 4.9 compared to the industry median at 23.0. This means that it has a lower price relative to its earnings compared to its peers. This makes Starbox Group Holdings Ltd more attractive for value investors.

Starbox Group Holdings Ltd’s price-to-book ratio is higher than its peers. This could make Starbox Group Holdings Ltd less attractive for value investors when compared to the industry median at 2.77.

You can read more about Starbox Group Holdings Ltd’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Usio Inc’s Value Grade

Value Grade:

Usio, Inc. is a cloud-based, Fintech payment processor. It serves multiple industry verticals with technology that facilitates payment acceptance and funds disbursement in a single, full-stack ecosystem. It provides payment acceptance through multiple payment methods, including payment facilitation, prepaid card and electronic billing products and services to businesses, merchants and consumers. Through its Prepaid Debit Card platform, it offers a variety of prepaid card products, such as reloadable, incentive, promotional and corporate card programs. It provides integrated electronic payment processing services to merchants and businesses, including credit and debit card-based processing services and electronic funds transfer via the ACH network. Its card-based processing services enable merchants to process both traditional card-present, tap-and-pay, or swipe transactions, and card-not-present transactions. Its UsioCard platform supports Apple Pay, Samsung Pay and Google Pay.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Usio Inc has a Value Score of 81, which is considered to be undervalued.

Usio Inc’s price-to-book ratio is higher than its peers. This could make Usio Inc less attractive for value investors when compared to the industry median at 2.77.

You can read more about Usio Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

VCI Global Ltd’s Value Grade

Value Grade:

VCI Global Limited is a Malaysia-based diversified holding company. Through its subsidiaries, the Company focuses on consulting, fintech, artificial intelligence (AI), robotics, cybersecurity, and gamification. It primarily offers consulting services in capital markets, real estate, AI, and technology. Under its business strategy consultancy segment, the Company focuses on listing solutions, investors relations and boardroom strategies consultancy. It begins from pre-listing diagnosis and planning to the finalization of the entire listing process. It extends its services line to include investor relations consultation. Further, it also offers services in attaining boardroom strategies. Its strategic options consist of mergers and acquisitions, initial public offerings, restructuring and transformation. It also operates Socializer Messenger, which offers built-in face recognition, self-destructing messages, and additional app lock to shield the conversations from unauthorized access.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

VCI Global Ltd has a Value Score of 64, which is considered to be undervalued.

VCI Global Ltd’s price-earnings ratio is 2.9 compared to the industry median at 23.0. This means that it has a lower price relative to its earnings compared to its peers. This makes VCI Global Ltd more attractive for value investors.

VCI Global Ltd’s price-to-book ratio is higher than its peers. This could make VCI Global Ltd less attractive for value investors when compared to the industry median at 2.77.

You can read more about VCI Global Ltd’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Business Support Services Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Business Support Services stocks as well as other industrys.

Choosing Which of the 7 Best Business Support Services Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Emerald Holding Inc stock has a Value Grade of A.
• PagSeguro Digital Ltd stock has a Value Grade of A.
• Pharma-Bio Serv Inc stock has a Value Grade of B.
• Resources Connection Inc stock has a Value Grade of B.
• Starbox Group Holdings Ltd stock has a Value Grade of A.
• Usio Inc stock has a Value Grade of A.
• VCI Global Ltd stock has a Value Grade of B.

Now that you have a bit more background about each of the 7 undervalued stocks in the Business Support Services industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Business Support Services Stocks

Want to learn more about Business Support Services stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 7 Undervalued Business Support Services Stocks for Monday, July 01
• 5 Undervalued Business Support Services Stocks for Friday, June 28
• Why Corecivic Inc’s (CXW) Stock Is Up 6.05%
• Why Global Blue Group Holding Ltd’s (GB) Stock Is Down 5.49%

AAII Disclaimer

We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.