HOLX or EW: Which Is the Better Value Stock Right Now?
Investors interested in Medical - Instruments stocks are likely familiar with Hologic (HOLX) and Edwards Lifesciences (EW). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Right now, both Hologic and Edwards Lifesciences are sporting a Zacks Rank of # 2 (Buy). This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is only part of the picture for value investors.
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.
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.
HOLX currently has a forward P/E ratio of 18.63, while EW has a forward P/E of 31.26. We also note that HOLX has a PEG ratio of 2.53. 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. EW currently has a PEG ratio of 4.33.
Another notable valuation metric for HOLX is its P/B ratio of 3.77. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, EW has a P/B of 7.78.
These metrics, and several others, help HOLX earn a Value grade of B, while EW has been given a Value grade of D.
Both HOLX and EW are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that HOLX is the superior value option right now.
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Hologic, Inc. (HOLX) : Free Stock Analysis Report
Edwards Lifesciences Corporation (EW) : Free Stock Analysis Report
