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ICUI vs. SYK: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Medical - Products sector might want to consider either ICU Medical (ICUI - Free Report) or Stryker (SYK - 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.

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 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.

ICU Medical has a Zacks Rank of #2 (Buy), while Stryker has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that ICUI likely has seen a stronger improvement to its earnings outlook than SYK has recently. But this is only part of the picture 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.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

ICUI currently has a forward P/E ratio of 19.02, while SYK has a forward P/E of 22.01. We also note that ICUI has a PEG ratio of 1.73. 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 2.11.

Another notable valuation metric for ICUI is its P/B ratio of 1.84. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, SYK has a P/B of 5.5.

These are just a few of the metrics contributing to ICUI's Value grade of B and SYK's Value grade of D.

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

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