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MD vs. AVTR: Which Stock Should Value Investors Buy Now?
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Investors looking for stocks in the Medical Services sector might want to consider either Pediatrix Medical Group (MD - Free Report) or Avantor, Inc. (AVTR - Free Report) . 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.
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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Currently, Pediatrix Medical Group has a Zacks Rank of #2 (Buy), while Avantor, Inc. has a Zacks Rank of #4 (Sell). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that MD is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
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 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.
MD currently has a forward P/E ratio of 9.38, while AVTR has a forward P/E of 25.23. We also note that MD has a PEG ratio of 1.72. 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. AVTR currently has a PEG ratio of 2.60.
Another notable valuation metric for MD is its P/B ratio of 1.43. 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, AVTR has a P/B of 3.18.
These metrics, and several others, help MD earn a Value grade of A, while AVTR has been given a Value grade of C.
MD sticks out from AVTR in both our Zacks Rank and Style Scores models, so value investors will likely feel that MD is the better option right now.
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MD vs. AVTR: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Medical Services sector might want to consider either Pediatrix Medical Group (MD - Free Report) or Avantor, Inc. (AVTR - Free Report) . 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.
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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Currently, Pediatrix Medical Group has a Zacks Rank of #2 (Buy), while Avantor, Inc. has a Zacks Rank of #4 (Sell). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that MD is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
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 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.
MD currently has a forward P/E ratio of 9.38, while AVTR has a forward P/E of 25.23. We also note that MD has a PEG ratio of 1.72. 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. AVTR currently has a PEG ratio of 2.60.
Another notable valuation metric for MD is its P/B ratio of 1.43. 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, AVTR has a P/B of 3.18.
These metrics, and several others, help MD earn a Value grade of A, while AVTR has been given a Value grade of C.
MD sticks out from AVTR in both our Zacks Rank and Style Scores models, so value investors will likely feel that MD is the better option right now.