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BAX vs. CLPBY: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Medical - Products sector have probably already heard of Baxter International (BAX - Free Report) and Coloplast A/S (CLPBY - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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.

Currently, Baxter International has a Zacks Rank of #2 (Buy), while Coloplast A/S has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that BAX is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

BAX currently has a forward P/E ratio of 23.13, while CLPBY has a forward P/E of 36.07. We also note that BAX has a PEG ratio of 1.81. 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. CLPBY currently has a PEG ratio of 3.61.

Another notable valuation metric for BAX is its P/B ratio of 5.22. 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, CLPBY has a P/B of 26.97.

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

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


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Baxter International Inc. (BAX) - free report >>

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