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GSK vs. TECH: Which Stock Is the Better Value Option?
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Investors interested in Medical - Biomedical and Genetics stocks are likely familiar with GSK (GSK - Free Report) and Techne (TECH - 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.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, GSK is sporting a Zacks Rank of #2 (Buy), while Techne has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that GSK has an improving earnings outlook. But this is only part of the picture for value investors.
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.
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.
GSK currently has a forward P/E ratio of 9.46, while TECH has a forward P/E of 35.15. We also note that GSK has a PEG ratio of 1.72. 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 2.70.
Another notable valuation metric for GSK is its P/B ratio of 5.17. 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 6.73.
These metrics, and several others, help GSK earn a Value grade of A, while TECH has been given a Value grade of D.
GSK has seen stronger estimate revision activity and sports more attractive valuation metrics than TECH, so it seems like value investors will conclude that GSK is the superior option right now.
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GSK vs. TECH: Which Stock Is the Better Value Option?
Investors interested in Medical - Biomedical and Genetics stocks are likely familiar with GSK (GSK - Free Report) and Techne (TECH - 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.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, GSK is sporting a Zacks Rank of #2 (Buy), while Techne has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that GSK has an improving earnings outlook. But this is only part of the picture for value investors.
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.
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.
GSK currently has a forward P/E ratio of 9.46, while TECH has a forward P/E of 35.15. We also note that GSK has a PEG ratio of 1.72. 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 2.70.
Another notable valuation metric for GSK is its P/B ratio of 5.17. 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 6.73.
These metrics, and several others, help GSK earn a Value grade of A, while TECH has been given a Value grade of D.
GSK has seen stronger estimate revision activity and sports more attractive valuation metrics than TECH, so it seems like value investors will conclude that GSK is the superior option right now.