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MDT vs. ABT: Which Stock Is the Better Value Option?
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Investors looking for stocks in the Medical - Products sector might want to consider either Medtronic (MDT - Free Report) or Abbott (ABT - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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, Medtronic has a Zacks Rank of #2 (Buy), while Abbott has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that MDT has an improving earnings outlook. But this is just one factor that value investors are interested in.
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.
MDT currently has a forward P/E ratio of 16.97, while ABT has a forward P/E of 25.55. We also note that MDT has a PEG ratio of 2.64. 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. ABT currently has a PEG ratio of 2.81.
Another notable valuation metric for MDT is its P/B ratio of 2.46. 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, ABT has a P/B of 5.25.
These are just a few of the metrics contributing to MDT's Value grade of B and ABT's Value grade of C.
MDT has seen stronger estimate revision activity and sports more attractive valuation metrics than ABT, so it seems like value investors will conclude that MDT is the superior option right now.
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MDT vs. ABT: Which Stock Is the Better Value Option?
Investors looking for stocks in the Medical - Products sector might want to consider either Medtronic (MDT - Free Report) or Abbott (ABT - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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, Medtronic has a Zacks Rank of #2 (Buy), while Abbott has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that MDT has an improving earnings outlook. But this is just one factor that value investors are interested in.
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.
MDT currently has a forward P/E ratio of 16.97, while ABT has a forward P/E of 25.55. We also note that MDT has a PEG ratio of 2.64. 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. ABT currently has a PEG ratio of 2.81.
Another notable valuation metric for MDT is its P/B ratio of 2.46. 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, ABT has a P/B of 5.25.
These are just a few of the metrics contributing to MDT's Value grade of B and ABT's Value grade of C.
MDT has seen stronger estimate revision activity and sports more attractive valuation metrics than ABT, so it seems like value investors will conclude that MDT is the superior option right now.