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AVTR or DOCS: Which Is the Better Value Stock Right Now?

Zacks Equity Research
·2-min read

Investors interested in Medical Services stocks are likely familiar with Avantor, Inc. (AVTR) and Doximity (DOCS). 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 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.

Currently, Avantor, Inc. has a Zacks Rank of #2 (Buy), while Doximity has a Zacks Rank of #3 (Hold). This means that AVTR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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.

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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.

AVTR currently has a forward P/E ratio of 18.61, while DOCS has a forward P/E of 56.25. We also note that AVTR has a PEG ratio of 0.60. 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. DOCS currently has a PEG ratio of 9.14.

Another notable valuation metric for AVTR is its P/B ratio of 5.13. 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, DOCS has a P/B of 8.81.

Based on these metrics and many more, AVTR holds a Value grade of B, while DOCS has a Value grade of D.

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


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Avantor, Inc. (AVTR) : Free Stock Analysis Report
 
Doximity, Inc. (DOCS) : Free Stock Analysis Report
 
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Zacks Investment Research