Investors interested in stocks from the Medical Services sector have probably already heard of Icon PLC (ICLR - Free Report) and Charles River Laboratories (CRL - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, Icon PLC is sporting a Zacks Rank of #2 (Buy), while Charles River Laboratories has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that ICLR likely has seen a stronger improvement to its earnings outlook than CRL has recently. But this is only part of the picture for value investors.
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.
ICLR currently has a forward P/E ratio of 20.61, while CRL has a forward P/E of 20.81. We also note that ICLR has a PEG ratio of 1.39. 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. CRL currently has a PEG ratio of 1.79.
Another notable valuation metric for ICLR is its P/B ratio of 2.70. 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, CRL has a P/B of 3.26.
These metrics, and several others, help ICLR earn a Value grade of B, while CRL has been given a Value grade of C.
ICLR has seen stronger estimate revision activity and sports more attractive valuation metrics than CRL, so it seems like value investors will conclude that ICLR is the superior option right now.
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Investors interested in stocks from the Medical Services sector have probably already heard of Icon PLC (ICLR - Free Report) and Charles River Laboratories (CRL - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, Icon PLC is sporting a Zacks Rank of #2 (Buy), while Charles River Laboratories has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that ICLR likely has seen a stronger improvement to its earnings outlook than CRL has recently. But this is only part of the picture for value investors.
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.
ICLR currently has a forward P/E ratio of 20.61, while CRL has a forward P/E of 20.81. We also note that ICLR has a PEG ratio of 1.39. 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. CRL currently has a PEG ratio of 1.79.
Another notable valuation metric for ICLR is its P/B ratio of 2.70. 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, CRL has a P/B of 3.26.
These metrics, and several others, help ICLR earn a Value grade of B, while CRL has been given a Value grade of C.
ICLR has seen stronger estimate revision activity and sports more attractive valuation metrics than CRL, so it seems like value investors will conclude that ICLR is the superior option right now.
Only $1 to See All Zacks' Buys and Sells
We're not kidding.
Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent.
Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators,and more, that closed 228 positions with double- and triple-digit gains in 2023 alone.
See Stocks Now >>
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