Investors interested in Medical - Instruments stocks are likely familiar with Teleflex (TFX) and Edwards Lifesciences (EW). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Teleflex has a Zacks Rank of #2 (Buy), while Edwards Lifesciences has a Zacks Rank of #4 (Sell). Investors should feel comfortable knowing that TFX likely has seen a stronger improvement to its earnings outlook than EW has recently. 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 highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
TFX currently has a forward P/E ratio of 17.13, while EW has a forward P/E of 22.83. We also note that TFX has a PEG ratio of 2.28. 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. EW currently has a PEG ratio of 2.57.
Another notable valuation metric for TFX is its P/B ratio of 2.44. 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, EW has a P/B of 4.97.
Based on these metrics and many more, TFX holds a Value grade of B, while EW has a Value grade of C.
TFX stands above EW thanks to its solid earnings outlook, and based on these valuation figures, we also feel that TFX is the superior value option right now.
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Free: See Our Top Stock And 4 Runners UpTeleflex Incorporated (TFX) : Free Stock Analysis Report
Edwards Lifesciences Corporation (EW) : Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
