Back to top

Image: Bigstock

HLN or SYK: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors with an interest in Medical - Products stocks have likely encountered both Haleon PLC Sponsored ADR (HLN - Free Report) and Stryker (SYK - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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

Currently, Haleon PLC Sponsored ADR has a Zacks Rank of #2 (Buy), while Stryker has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that HLN likely has seen a stronger improvement to its earnings outlook than SYK has recently. However, value investors will care about much more than just this.

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.

HLN currently has a forward P/E ratio of 18.24, while SYK has a forward P/E of 27.40. We also note that HLN has a PEG ratio of 2.59. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. SYK currently has a PEG ratio of 2.91.

Another notable valuation metric for HLN is its P/B ratio of 1.88. 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, SYK has a P/B of 6.25.

These are just a few of the metrics contributing to HLN's Value grade of B and SYK's Value grade of C.

HLN stands above SYK thanks to its solid earnings outlook, and based on these valuation figures, we also feel that HLN is the superior value option right now.


See More Zacks Research for These Tickers


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


Stryker Corporation (SYK) - free report >>

Haleon PLC Sponsored ADR (HLN) - free report >>

Published in