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TheStreet Open House

Sony: Strong Play for Growth, Value and Income

Stocks in this article: SNE AAPL MSFT

NEW YORK (TheStreet) -- Kicking off the Consumer Electronics Show in Las Vegas, Kaz Hira, Chief Executive Officer of Sony (SNE - Get Report), focused on his company's plans for a cloud-based TV service, 4K TVs and other products. It is all part of the "One Sony" vision that Hira has emphasized since taking over in April 2012.

There are three reasons investors should be bullish about the future of Sony.

1. "We all know content is king. We've made advances there as well," stated Sony President Mike Fasulo. I think that can certainly be seen in the tepid stock price performance for Apple (AAPL) and Samsung reporting a decline in profits, companies seen as royalty in the world of hardware.

Sony has tons of content and it is bringing in more for the consumer. Sony announced two new content products at the CES: PlayStation Now, which is a network for cloud-based games; and a video service for live and on-demand offerings.

2. Financials are compelling for growth, value, and income investors.

The sales growth rate for Sony over the past five years was a negative 5.20%. It is now 10.60% on a quarterly basis. For the past half decade, the earnings-per-share growth rate was off by 35%. This year, the earnings-per-share growth rate is 108.90%. Over the next five years it is projected to be 55.80%. The strong sales of PlayStation 4 add credibility to that bullish outlook. That should please even the most demanding of growth investors.

Those seeking value should be enamored of a price-to-sales ratio of 0.27. That means that every dollar of sales is valued at almost a 75% discount in the stock price of Sony. The price-to-book ratio is 0.86, providing a discount of almost 15% for those buying shares based on the asset value. With both sales and earnings growing, Sony is obviously not a value trap, but a value play.

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