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Investors interested in stocks from the Medical - Biomedical and Genetics sector have probably already heard of Halozyme Therapeutics (HALO) and Amicus Therapeutics (FOLD). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Halozyme Therapeutics and Amicus Therapeutics are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that HALO 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 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.
HALO currently has a forward P/E ratio of 11.59, while FOLD has a forward P/E of 41.12. We also note that HALO has a PEG ratio of 0.40. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. FOLD currently has a PEG ratio of 0.91.
Another notable valuation metric for HALO is its P/B ratio of 13.20. 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, FOLD has a P/B of 16.38.
These are just a few of the metrics contributing to HALO's Value grade of A and FOLD's Value grade of D.
HALO is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that HALO is likely the superior value option right now.
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Halozyme Therapeutics, Inc. (HALO) : Free Stock Analysis Report