HAE vs. ABT: Which Stock Is the Better Value Option?
Investors looking for stocks in the Medical - Products sector might want to consider either Haemonetics (HAE) or Abbott (ABT). 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Haemonetics has a Zacks Rank of #2 (Buy), while Abbott 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 HAE has an improving earnings outlook. However, value investors will care about much more than just this.
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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
HAE currently has a forward P/E ratio of 19.36, while ABT has a forward P/E of 24.18. We also note that HAE has a PEG ratio of 1.94. 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. ABT currently has a PEG ratio of 2.69.
Another notable valuation metric for HAE is its P/B ratio of 4.28. 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, ABT has a P/B of 5.14.
Based on these metrics and many more, HAE holds a Value grade of B, while ABT has a Value grade of C.
HAE is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that HAE is likely the superior value option right now.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Haemonetics Corporation (HAE) : Free Stock Analysis Report
Abbott Laboratories (ABT) : Free Stock Analysis Report
