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PAHC vs. BSX: Which Stock Is the Better Value Option?

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Investors with an interest in Medical - Products stocks have likely encountered both Phibro Animal Health (PAHC - Free Report) and Boston Scientific (BSX - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

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, Phibro Animal Health is sporting a Zacks Rank of #1 (Strong Buy), while Boston Scientific has a Zacks Rank of #2 (Buy). Investors should feel comfortable knowing that PAHC likely has seen a stronger improvement to its earnings outlook than BSX has recently. But this is just one factor that value investors are interested in.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.

PAHC currently has a forward P/E ratio of 12.59, while BSX has a forward P/E of 36.55. We also note that PAHC has a PEG ratio of 0.48. 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. BSX currently has a PEG ratio of 2.75.

Another notable valuation metric for PAHC is its P/B ratio of 3.91. 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, BSX has a P/B of 7.02.

These are just a few of the metrics contributing to PAHC's Value grade of A and BSX's Value grade of D.

PAHC has seen stronger estimate revision activity and sports more attractive valuation metrics than BSX, so it seems like value investors will conclude that PAHC is the superior option right now.


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