Back to top

Image: Bigstock

HRC vs. GNNDY: Which Stock Is the Better Value Option?

Read MoreHide Full Article

Investors interested in stocks from the Medical - Products sector have probably already heard of Hill-Rom and GN STORE NORD (GNNDY - 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.

Right now, Hill-Rom is sporting a Zacks Rank of #2 (Buy), while GN STORE NORD has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that HRC has an improving earnings outlook. 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.

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.

HRC currently has a forward P/E ratio of 20.94, while GNNDY has a forward P/E of 29.58. We also note that HRC has a PEG ratio of 1.82. 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. GNNDY currently has a PEG ratio of 1.85.

Another notable valuation metric for HRC is its P/B ratio of 4.54. 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, GNNDY has a P/B of 9.11.

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

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


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


GN Store Nord (GNNDY) - free report >>

Published in