AHCO vs. LMAT: Which Stock Should Value Investors Buy Now?
AHCO vs. LMAT: Which Stock Is the Better Value Option?
Investors with an interest in Medical - Products stocks have likely encountered both AdaptHealth Corp. (AHCO) and LeMaitre Vascular (LMAT). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive 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, AdaptHealth Corp. has a Zacks Rank of #2 (Buy), while LeMaitre Vascular has a Zacks Rank of #3 (Hold). This means that AHCO's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.
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.
AHCO currently has a forward P/E ratio of 14.24, while LMAT has a forward P/E of 34.94. We also note that AHCO has a PEG ratio of 0.44. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. LMAT currently has a PEG ratio of 3.49.
Another notable valuation metric for AHCO is its P/B ratio of 1.54. 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, LMAT has a P/B of 4.42.
These are just a few of the metrics contributing to AHCO's Value grade of A and LMAT's Value grade of C.
AHCO stands above LMAT thanks to its solid earnings outlook, and based on these valuation figures, we also feel that AHCO is the superior value option right now.
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