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COHR vs. WDH: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Technology Services sector might want to consider either Coherent (COHR - Free Report) or Waterdrop Inc. Unsponsored ADR (WDH - 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.

Coherent and Waterdrop Inc. Unsponsored ADR are both sporting a Zacks Rank of # 2 (Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. 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.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

COHR currently has a forward P/E ratio of 10.84, while WDH has a forward P/E of 13.08. We also note that COHR has a PEG ratio of 0.84. 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. WDH currently has a PEG ratio of 10.90.

Another notable valuation metric for COHR is its P/B ratio of 1.17. 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, WDH has a P/B of 9.45.

These are just a few of the metrics contributing to COHR's Value grade of A and WDH's Value grade of D.

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


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