Investors interested in Medical - Instruments stocks are likely familiar with Integer (ITGR) and SONOVA HOLDING (SONVY). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, Integer is sporting a Zacks Rank of #1 (Strong Buy), while SONOVA HOLDING has a Zacks Rank of #4 (Sell). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that ITGR is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.
ITGR currently has a forward P/E ratio of 18.61, while SONVY has a forward P/E of 23.74. We also note that ITGR has a PEG ratio of 1.01. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SONVY currently has a PEG ratio of 3.22.
Another notable valuation metric for ITGR is its P/B ratio of 2.53. 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, SONVY has a P/B of 6.99.
Based on these metrics and many more, ITGR holds a Value grade of B, while SONVY has a Value grade of D.
ITGR 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 ITGR is likely the superior value option right now.
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Integer Holdings Corporation (ITGR): Free Stock Analysis Report SONOVA HOLDING (SONVY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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