HRMY vs. REGN: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Medical - Biomedical and Genetics sector might want to consider either Harmony Biosciences Holdings, Inc. (HRMY) or Regeneron (REGN). 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 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, Harmony Biosciences Holdings, Inc. has a Zacks Rank of #2 (Buy), while Regeneron has a Zacks Rank of #3 (Hold). This means that HRMY's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture for value investors.
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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
HRMY currently has a forward P/E ratio of 17.47, while REGN has a forward P/E of 24.34. We also note that HRMY has a PEG ratio of 0.77. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. REGN currently has a PEG ratio of 3.14.
Another notable valuation metric for HRMY is its P/B ratio of 4.03. 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, REGN has a P/B of 4.27.
Based on these metrics and many more, HRMY holds a Value grade of A, while REGN has a Value grade of C.
HRMY 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 HRMY is likely the superior value option right now.
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Harmony Biosciences Holdings, Inc. (HRMY) : Free Stock Analysis Report
Regeneron Pharmaceuticals, Inc. (REGN) : Free Stock Analysis Report