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

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Investors interested in Medical - Products stocks are likely familiar with Haemonetics (HAE - 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.

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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Currently, Haemonetics has a Zacks Rank of #2 (Buy), while Stryker has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that HAE 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.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

HAE currently has a forward P/E ratio of 21.89, while SYK has a forward P/E of 25.70. We also note that HAE has a PEG ratio of 2.19. 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. SYK currently has a PEG ratio of 2.55.

Another notable valuation metric for HAE is its P/B ratio of 4.83. 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 6.29.

These metrics, and several others, help HAE earn a Value grade of B, while SYK has been given a Value grade of D.

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


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