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BMY vs. VRTX: Which Stock Is the Better Value Option?
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Investors looking for stocks in the Medical - Biomedical and Genetics sector might want to consider either Bristol Myers Squibb (BMY - Free Report) or Vertex Pharmaceuticals (VRTX - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, Bristol Myers Squibb is sporting a Zacks Rank of #2 (Buy), while Vertex Pharmaceuticals has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that BMY likely has seen a stronger improvement to its earnings outlook than VRTX has recently. However, value investors will care about much more than just this.
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 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.
BMY currently has a forward P/E ratio of 61.29, while VRTX has a forward P/E of 934.65. We also note that BMY has a PEG ratio of 15.32. 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. VRTX currently has a PEG ratio of 76.61.
Another notable valuation metric for BMY is its P/B ratio of 6.58. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, VRTX has a P/B of 7.66.
Based on these metrics and many more, BMY holds a Value grade of A, while VRTX has a Value grade of D.
BMY stands above VRTX thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BMY is the superior value option right now.
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BMY vs. VRTX: Which Stock Is the Better Value Option?
Investors looking for stocks in the Medical - Biomedical and Genetics sector might want to consider either Bristol Myers Squibb (BMY - Free Report) or Vertex Pharmaceuticals (VRTX - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, Bristol Myers Squibb is sporting a Zacks Rank of #2 (Buy), while Vertex Pharmaceuticals has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that BMY likely has seen a stronger improvement to its earnings outlook than VRTX has recently. However, value investors will care about much more than just this.
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 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.
BMY currently has a forward P/E ratio of 61.29, while VRTX has a forward P/E of 934.65. We also note that BMY has a PEG ratio of 15.32. 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. VRTX currently has a PEG ratio of 76.61.
Another notable valuation metric for BMY is its P/B ratio of 6.58. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, VRTX has a P/B of 7.66.
Based on these metrics and many more, BMY holds a Value grade of A, while VRTX has a Value grade of D.
BMY stands above VRTX thanks to its solid earnings outlook, and based on these valuation figures, we also feel that BMY is the superior value option right now.