ESLOY vs. RMD: Which Stock Is the Better Value Option?
Investors interested in Medical - Products stocks are likely familiar with EssilorLuxottica Unsponsored ADR (ESLOY) and ResMed (RMD). 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.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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, EssilorLuxottica Unsponsored ADR has a Zacks Rank of #2 (Buy), while ResMed has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that ESLOY likely has seen a stronger improvement to its earnings outlook than RMD has recently. 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.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
ESLOY currently has a forward P/E ratio of 26.69, while RMD has a forward P/E of 36.04. We also note that ESLOY has a PEG ratio of 1.27. 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. RMD currently has a PEG ratio of 1.50.
Another notable valuation metric for ESLOY is its P/B ratio of 1.90. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, RMD has a P/B of 9.91.
These are just a few of the metrics contributing to ESLOY's Value grade of B and RMD's Value grade of C.
ESLOY stands above RMD thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ESLOY is the superior value option right now.
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EssilorLuxottica Unsponsored ADR (ESLOY) : Free Stock Analysis Report
ResMed Inc. (RMD) : Free Stock Analysis Report
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