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HOLX vs. SMLR: Which Stock Should Value Investors Buy Now?

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Zacks Equity Research
·2 min read
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Investors interested in Medical - Instruments stocks are likely familiar with Hologic (HOLX) and Semler Scientific Inc. (SMLR). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, both Hologic and Semler Scientific Inc. are holding a Zacks Rank of # 2 (Buy). 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. But this is just one factor that value investors are interested in.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

HOLX currently has a forward P/E ratio of 8.43, while SMLR has a forward P/E of 44.50. We also note that HOLX has a PEG ratio of 0.55. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. SMLR currently has a PEG ratio of 1.78.

Another notable valuation metric for HOLX is its P/B ratio of 5.86. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, SMLR has a P/B of 24.12.

These are just a few of the metrics contributing to HOLX's Value grade of A and SMLR's Value grade of D.

Both HOLX and SMLR 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
 
Semler Scientific Inc. (SMLR) : Free Stock Analysis Report
 
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Zacks Investment Research