Yahoo Finance GMED vs. SONVY: Which Stock Is the Better Value Option?
Investors interested in stocks from the Medical - Instruments sector have probably already heard of Globus Medical (GMED) and SONOVA HOLDING (SONVY). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, Globus Medical is sporting a Zacks Rank of #2 (Buy), while SONOVA HOLDING has a Zacks Rank of #5 (Strong Sell). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that GMED is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.
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.
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.
GMED currently has a forward P/E ratio of 24.25, while SONVY has a forward P/E of 25.65. We also note that GMED has a PEG ratio of 1.90. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. SONVY currently has a PEG ratio of 2.93.
Another notable valuation metric for GMED is its P/B ratio of 2.36. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, SONVY has a P/B of 7.71.
These metrics, and several others, help GMED earn a Value grade of B, while SONVY has been given a Value grade of D.
GMED stands above SONVY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that GMED is the superior value option right now.
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Globus Medical, Inc. (GMED) : Free Stock Analysis Report
SONOVA HOLDING (SONVY) : Free Stock Analysis Report
