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NVST vs. ABT: Which Stock Is the Better Value Option?

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Investors looking for stocks in the Medical - Products sector might want to consider either Envista (NVST - Free Report) or Abbott (ABT - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, Envista is sporting a Zacks Rank of #2 (Buy), while Abbott has a Zacks Rank of #3 (Hold). This means that NVST's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its 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.

NVST currently has a forward P/E ratio of 18.01, while ABT has a forward P/E of 25.90. We also note that NVST has a PEG ratio of 1.07. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ABT currently has a PEG ratio of 2.53.

Another notable valuation metric for NVST is its P/B ratio of 1.06. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, ABT has a P/B of 4.56.

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

NVST sticks out from ABT in both our Zacks Rank and Style Scores models, so value investors will likely feel that NVST is the better option right now.


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