Back to top

Image: Bigstock

BIIB vs. TECH: Which Stock Is the Better Value Option?

Read MoreHide Full Article

Investors with an interest in Medical - Biomedical and Genetics stocks have likely encountered both Biogen Inc. (BIIB - Free Report) and Techne (TECH - 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Biogen Inc. and Techne are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. Investors should feel comfortable knowing that BIIB likely has seen a stronger improvement to its earnings outlook than TECH has recently. 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.

BIIB currently has a forward P/E ratio of 17.01, while TECH has a forward P/E of 39.26. We also note that BIIB has a PEG ratio of 1.70. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. TECH currently has a PEG ratio of 2.45.

Another notable valuation metric for BIIB is its P/B ratio of 3.26. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, TECH has a P/B of 7.34.

Based on these metrics and many more, BIIB holds a Value grade of A, while TECH has a Value grade of D.

BIIB 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 BIIB is likely the superior value option right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Biogen Inc. (BIIB) - free report >>

Bio-Techne Corp (TECH) - free report >>

Published in