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REGN vs. INCY: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Medical - Biomedical and Genetics sector have probably already heard of Regeneron (REGN - Free Report) and Incyte (INCY - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 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.

Regeneron and Incyte are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that REGN is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

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.

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.

REGN currently has a forward P/E ratio of 11.12, while INCY has a forward P/E of 29.36. We also note that REGN has a PEG ratio of 0.61. 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. INCY currently has a PEG ratio of 0.82.

Another notable valuation metric for REGN is its P/B ratio of 4.90. 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, INCY has a P/B of 7.

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

REGN 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 REGN is likely the superior value option right now.


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Regeneron Pharmaceuticals, Inc. (REGN) - free report >>

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