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EXEL vs. ARGX: Which Stock Should Value Investors Buy Now?

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Investors looking for stocks in the Medical - Biomedical and Genetics sector might want to consider either Exelixis (EXEL - Free Report) or argenex SE (ARGX - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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.

Exelixis and argenex SE are both sporting a Zacks Rank of # 2 (Buy) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. However, value investors will care about much more than just this.

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.

EXEL currently has a forward P/E ratio of 16, while ARGX has a forward P/E of 50.23. We also note that EXEL has a PEG ratio of 1.05. 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. ARGX currently has a PEG ratio of 1.54.

Another notable valuation metric for EXEL is its P/B ratio of 4.70. 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, ARGX has a P/B of 8.14.

Based on these metrics and many more, EXEL holds a Value grade of B, while ARGX has a Value grade of D.

Both EXEL and ARGX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that EXEL is the superior value option right now.


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