PETQ vs. BSX: Which Stock Is the Better Value Option?
Investors looking for stocks in the Medical - Products sector might want to consider either PetIQ (PETQ) or Boston Scientific (BSX). 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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
PetIQ and Boston Scientific are both sporting a Zacks Rank of # 2 (Buy) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. But this is just one factor that value investors are interested in.
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 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.
PETQ currently has a forward P/E ratio of 6.58, while BSX has a forward P/E of 23.97. We also note that PETQ has a PEG ratio of 0.82. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BSX currently has a PEG ratio of 2.32.
Another notable valuation metric for PETQ is its P/B ratio of 1.29. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, BSX has a P/B of 3.73.
These are just a few of the metrics contributing to PETQ's Value grade of A and BSX's Value grade of C.
Both PETQ and BSX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that PETQ is 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
PetIQ, Inc. (PETQ) : Free Stock Analysis Report
Boston Scientific Corporation (BSX) : Free Stock Analysis Report
