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HAE vs. BSX: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Medical - Products sector might want to consider either Haemonetics (HAE - Free Report) or Boston Scientific (BSX - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, both Haemonetics and Boston Scientific are sporting a Zacks Rank of # 2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. However, value investors will care about much more than just this.

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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

HAE currently has a forward P/E ratio of 16.74, while BSX has a forward P/E of 34.61. We also note that HAE has a PEG ratio of 1.20. 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. BSX currently has a PEG ratio of 2.75.

Another notable valuation metric for HAE is its P/B ratio of 4.31. 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, BSX has a P/B of 5.94.

These are just a few of the metrics contributing to HAE's Value grade of B and BSX's Value grade of C.

Both HAE and BSX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that HAE is the superior value option right now.


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