XRAY or COO: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Medical - Dental Supplies sector might want to consider either Dentsply International (XRAY) or The Cooper Companies (COO). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
Dentsply International has a Zacks Rank of #2 (Buy), while The Cooper Companies has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that XRAY likely has seen a stronger improvement to its earnings outlook than COO has recently. 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
XRAY currently has a forward P/E ratio of 16.40, while COO has a forward P/E of 25.51. We also note that XRAY has a PEG ratio of 1.84. 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. COO currently has a PEG ratio of 2.55.
Another notable valuation metric for XRAY is its P/B ratio of 1.85. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, COO has a P/B of 2.15.
These are just a few of the metrics contributing to XRAY's Value grade of B and COO's Value grade of C.
XRAY is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that XRAY is likely the superior value option right now.
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DENTSPLY SIRONA Inc. (XRAY) : Free Stock Analysis Report
The Cooper Companies, Inc. (COO) : Free Stock Analysis Report
