Investors interested in stocks from the Medical - Biomedical and Genetics sector have probably already heard of Jazz Pharmaceuticals (JAZZ) and argenex SE (ARGX). 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Jazz Pharmaceuticals and argenex SE are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that JAZZ likely has seen a stronger improvement to its earnings outlook than ARGX has recently. But this is only part of the picture 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 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.

JAZZ currently has a forward P/E ratio of 5.27, while ARGX has a forward P/E of 47.10. We also note that JAZZ has a PEG ratio of 0.72. 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. ARGX currently has a PEG ratio of 1.45.

Another notable valuation metric for JAZZ is its P/B ratio of 1.82. 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, ARGX has a P/B of 6.51.

These are just a few of the metrics contributing to JAZZ's Value grade of A and ARGX's Value grade of D.

JAZZ is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that JAZZ is likely the superior value option right now.

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Jazz Pharmaceuticals PLC (JAZZ) : Free Stock Analysis Report

argenex SE (ARGX) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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