TFX vs. EW: Which Stock Should Value Investors Buy Now?
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Investors interested in Medical - Instruments stocks are likely familiar with Teleflex (TFX) and Edwards Lifesciences (EW). 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.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, Teleflex is sporting a Zacks Rank of #2 (Buy), while Edwards Lifesciences has a Zacks Rank of #3 (Hold). This means that TFX's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst 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.
TFX currently has a forward P/E ratio of 17.59, while EW has a forward P/E of 24.80. We also note that TFX has a PEG ratio of 2.23. 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. EW currently has a PEG ratio of 2.79.
Another notable valuation metric for TFX is its P/B ratio of 2.54. 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, EW has a P/B of 5.40.
Based on these metrics and many more, TFX holds a Value grade of B, while EW has a Value grade of C.
TFX has seen stronger estimate revision activity and sports more attractive valuation metrics than EW, so it seems like value investors will conclude that TFX is the superior option right now.
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Teleflex Incorporated (TFX) : Free Stock Analysis Report
Edwards Lifesciences Corporation (EW) : Free Stock Analysis Report