PDCO or CNMD: Which Is the Better Value Stock Right Now?
Investors interested in Medical - Dental Supplies stocks are likely familiar with Patterson Cos. (PDCO) and Conmed (CNMD). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, both Patterson Cos. and Conmed are holding a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. However, value investors will care about much more than just this.
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.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
PDCO currently has a forward P/E ratio of 11.50, while CNMD has a forward P/E of 34.83. We also note that PDCO has a PEG ratio of 1.59. 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. CNMD currently has a PEG ratio of 1.80.
Another notable valuation metric for PDCO is its P/B ratio of 2.38. 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, CNMD has a P/B of 4.82.
These are just a few of the metrics contributing to PDCO's Value grade of B and CNMD's Value grade of C.
Both PDCO and CNMD are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that PDCO is the superior value option right now.
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Patterson Companies, Inc. (PDCO) : Free Stock Analysis Report
CONMED Corporation (CNMD) : Free Stock Analysis Report
