USNA or ZTS: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Medical - Drugs sector have probably already heard of USANA Health Sciences (USNA) and Zoetis (ZTS). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, USANA Health Sciences has a Zacks Rank of #1 (Strong Buy), while Zoetis has a Zacks Rank of #3 (Hold). This means that USNA's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.
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.
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.
USNA currently has a forward P/E ratio of 20.56, while ZTS has a forward P/E of 34.93. We also note that USNA has a PEG ratio of 1.71. 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. ZTS currently has a PEG ratio of 3.05.
Another notable valuation metric for USNA is its P/B ratio of 2.72. 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, ZTS has a P/B of 18.93.
Based on these metrics and many more, USNA holds a Value grade of A, while ZTS has a Value grade of C.
USNA sticks out from ZTS in both our Zacks Rank and Style Scores models, so value investors will likely feel that USNA is the better option right now.
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USANA Health Sciences, Inc. (USNA) : Free Stock Analysis Report
Zoetis Inc. (ZTS) : Free Stock Analysis Report
