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EYE or SRDX: Which Is the Better Value Stock Right Now?

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Investors interested in Medical - Products stocks are likely familiar with National Vision (EYE - Free Report) and SurModics (SRDX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

National Vision and SurModics are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. Investors should feel comfortable knowing that EYE likely has seen a stronger improvement to its earnings outlook than SRDX has recently. But this is just one piece of the puzzle for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

EYE currently has a forward P/E ratio of 51.41, while SRDX has a forward P/E of 172.68. We also note that EYE has a PEG ratio of 2.23. 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. SRDX currently has a PEG ratio of 17.27.

Another notable valuation metric for EYE is its P/B ratio of 4.58. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, SRDX has a P/B of 5.22.

These metrics, and several others, help EYE earn a Value grade of B, while SRDX has been given a Value grade of C.

EYE 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 EYE is likely the superior value option right now.


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