Back to top

Image: Bigstock

COO or SAUHY: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors interested in Medical - Dental Supplies stocks are likely familiar with The Cooper Companies (COO - Free Report) and Straumann Holding AG (SAUHY - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

The Cooper Companies and Straumann Holding AG are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that COO is likely seeing its earnings outlook improve to a greater extent. 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.

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.

COO currently has a forward P/E ratio of 15.17, while SAUHY has a forward P/E of 29.60. We also note that COO has a PEG ratio of 1.81. 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. SAUHY currently has a PEG ratio of 2.40.

Another notable valuation metric for COO is its P/B ratio of 1.63. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, SAUHY has a P/B of 7.16.

Based on these metrics and many more, COO holds a Value grade of B, while SAUHY has a Value grade of C.

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

Zacks' 7 Best Strong Buy Stocks (New Research Report)

Valued at $99, click below to receive our just-released report predicting the 7 stocks that will soar highest in the coming month.

Click Here, It's Really Free

Published in