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HRC vs. BLFS: Which Stock Is the Better Value Option?

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Investors interested in Medical - Products stocks are likely familiar with Hill-Rom and BioLife Solutions, Inc. (BLFS - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? 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 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.

Hill-Rom has a Zacks Rank of #2 (Buy), while BioLife Solutions, Inc. has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that HRC has an improving earnings outlook. However, value investors will care about much more than just this.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.

HRC currently has a forward P/E ratio of 17.96, while BLFS has a forward P/E of 3,532. We also note that HRC has a PEG ratio of 2.48. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. BLFS currently has a PEG ratio of 353.20.

Another notable valuation metric for HRC is its P/B ratio of 3.92. 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, BLFS has a P/B of 6.05.

These metrics, and several others, help HRC earn a Value grade of B, while BLFS has been given a Value grade of D.

HRC 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 HRC is likely the superior value option right now.


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