IART or PEN: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Medical - Instruments sector might want to consider either Integra LifeSciences (IART) or Penumbra (PEN). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Both Integra LifeSciences and Penumbra have 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 only part of the picture for value investors.
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.
IART currently has a forward P/E ratio of 9.26, while PEN has a forward P/E of 62.66. We also note that IART has a PEG ratio of 0.77. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. PEN currently has a PEG ratio of 1.77.
Another notable valuation metric for IART is its P/B ratio of 1.18. 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, PEN has a P/B of 8.41.
These are just a few of the metrics contributing to IART's Value grade of A and PEN's Value grade of C.
Both IART and PEN are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that IART is the superior value option right now.
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Free: See Our Top Stock And 4 Runners UpIntegra LifeSciences Holdings Corporation (IART) : Free Stock Analysis Report
Penumbra, Inc. (PEN) : Free Stock Analysis Report
