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PFE vs. NVO: Which Stock Should Value Investors Buy Now?
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Investors looking for stocks in the Large Cap Pharmaceuticals sector might want to consider either Pfizer (PFE - Free Report) or Novo Nordisk (NVO - 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.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Pfizer has a Zacks Rank of #2 (Buy), while Novo Nordisk has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that PFE likely has seen a stronger improvement to its earnings outlook than NVO has recently. But this is just one factor that value investors are interested in.
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.
PFE currently has a forward P/E ratio of 11.24, while NVO has a forward P/E of 23.89. We also note that PFE has a PEG ratio of 1.48. 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. NVO currently has a PEG ratio of 2.69.
Another notable valuation metric for PFE is its P/B ratio of 3.43. 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, NVO has a P/B of 18.43.
These metrics, and several others, help PFE earn a Value grade of B, while NVO has been given a Value grade of C.
PFE stands above NVO thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PFE is the superior value option right now.
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PFE vs. NVO: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Large Cap Pharmaceuticals sector might want to consider either Pfizer (PFE - Free Report) or Novo Nordisk (NVO - 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.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Pfizer has a Zacks Rank of #2 (Buy), while Novo Nordisk has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that PFE likely has seen a stronger improvement to its earnings outlook than NVO has recently. But this is just one factor that value investors are interested in.
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.
PFE currently has a forward P/E ratio of 11.24, while NVO has a forward P/E of 23.89. We also note that PFE has a PEG ratio of 1.48. 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. NVO currently has a PEG ratio of 2.69.
Another notable valuation metric for PFE is its P/B ratio of 3.43. 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, NVO has a P/B of 18.43.
These metrics, and several others, help PFE earn a Value grade of B, while NVO has been given a Value grade of C.
PFE stands above NVO thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PFE is the superior value option right now.