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OCPNY or EW: Which Is the Better Value Stock Right Now?

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Investors with an interest in Medical - Instruments stocks have likely encountered both Olympus Corp. (OCPNY - Free Report) and Edwards Lifesciences (EW - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Olympus Corp. and Edwards Lifesciences are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that OCPNY has an improving earnings outlook. But this is just one piece of the puzzle for value investors.

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 Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

OCPNY currently has a forward P/E ratio of 15.65, while EW has a forward P/E of 35.27. We also note that OCPNY has a PEG ratio of 1.38. 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. EW currently has a PEG ratio of 2.61.

Another notable valuation metric for OCPNY is its P/B ratio of 6.21. 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, EW has a P/B of 9.25.

Based on these metrics and many more, OCPNY holds a Value grade of B, while EW has a Value grade of C.

OCPNY 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 OCPNY is likely the superior value option right now.


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