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XRAY vs. ALGN: Which Stock Is the Better Value Option?

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Investors with an interest in Medical - Dental Supplies stocks have likely encountered both Dentsply International (XRAY - Free Report) and Align Technology (ALGN - 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.

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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Currently, both Dentsply International and Align Technology are holding a Zacks Rank of # 2 (Buy). 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 also try to analyze a wide range of traditional figures and metrics to help determine whether 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.

XRAY currently has a forward P/E ratio of 23.59, while ALGN has a forward P/E of 65.83. We also note that XRAY has a PEG ratio of 1.18. 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. ALGN currently has a PEG ratio of 3.32.

Another notable valuation metric for XRAY is its P/B ratio of 2.82. 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, ALGN has a P/B of 14.66.

These are just a few of the metrics contributing to XRAY's Value grade of B and ALGN's Value grade of F.

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


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Align Technology, Inc. (ALGN) - free report >>

DENTSPLY SIRONA Inc. (XRAY) - free report >>

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