BMRN vs. CSLLY: Which Stock Should Value Investors Buy Now?

Zacks
18 Mar

Investors looking for stocks in the Medical - Biomedical and Genetics sector might want to consider either BioMarin Pharmaceutical (BMRN) or CSL Limited Sponsored ADR (CSLLY). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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 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.

BioMarin Pharmaceutical and CSL Limited Sponsored ADR are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that BMRN has an improving earnings outlook. But this is just one factor that value investors are interested in.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether 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.

BMRN currently has a forward P/E ratio of 16.71, while CSLLY has a forward P/E of 22.30. We also note that BMRN has a PEG ratio of 0.81. 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. CSLLY currently has a PEG ratio of 1.58.

Another notable valuation metric for BMRN is its P/B ratio of 2.41. 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, CSLLY has a P/B of 3.97.

Based on these metrics and many more, BMRN holds a Value grade of B, while CSLLY has a Value grade of C.

BMRN 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 BMRN is likely the superior value option right now.

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BioMarin Pharmaceutical Inc. (BMRN) : Free Stock Analysis Report

CSL Limited Sponsored ADR (CSLLY) : Free Stock Analysis Report

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

Zacks Investment Research

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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