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SDZNY or UTHR: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Medical - Drugs sector have probably already heard of Sandoz Group AG Sponsored ADR (SDZNY - Free Report) and United Therapeutics (UTHR - 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, Sandoz Group AG Sponsored ADR has a Zacks Rank of #2 (Buy), while United Therapeutics has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that SDZNY likely has seen a stronger improvement to its earnings outlook than UTHR has recently. However, value investors will care about much more than just this.

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 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.

SDZNY currently has a forward P/E ratio of 19.25, while UTHR has a forward P/E of 20.47. We also note that SDZNY has a PEG ratio of 1.72. 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. UTHR currently has a PEG ratio of 1.79.

Another notable valuation metric for SDZNY is its P/B ratio of 3.73. 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, UTHR has a P/B of 3.95.

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

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

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