Investors interested in stocks from the Medical - Biomedical and Genetics sector have probably already heard of Genmab A/S Sponsored ADR (GMAB) and Qiagen (QGEN). 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Genmab A/S Sponsored ADR has a Zacks Rank of #2 (Buy), while Qiagen has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that GMAB likely has seen a stronger improvement to its earnings outlook than QGEN has recently. 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.
GMAB currently has a forward P/E ratio of 13.55, while QGEN has a forward P/E of 19.85. We also note that GMAB has a PEG ratio of 0.54. 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. QGEN currently has a PEG ratio of 3.35.
Another notable valuation metric for GMAB is its P/B ratio of 2.85. 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, QGEN has a P/B of 2.93.
These are just a few of the metrics contributing to GMAB's Value grade of A and QGEN's Value grade of C.
GMAB stands above QGEN thanks to its solid earnings outlook, and based on these valuation figures, we also feel that GMAB is the superior value option right now.
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