There are good reasons to think that stocks in general are currently dangerously overvalued. For instance, the S&P 500's cyclically adjusted price-to-earnings ratio -- a measure of the stock market's valuation -- is currently 36.6, the highest it has been in more than 10 years.

Fortunately, even in a market where rich valuation metrics are run-of-the-mill, it is possible to find comparatively cheap stocks. Right now, two such companies are AbbVie (NYSE:ABBV) and Pfizer (NYSE:PFE). Here is why it is worth considering purchasing shares of these healthcare giants. 

1. AbbVie 

AbbVie currently trades for just 8.7 times forward earnings, while its price-to-earnings growth ratio (PEG) is 0.19. For context, the average forward P/E ratio for the S&P 500 is 22.3, while a PEG below 1 is generally considered undervalued.

But there is a lot more to like about AbbVie than its low valuation metrics, even though the company's crown jewel -- the rheumatoid arthritis drug Humira -- continues to lose steam in Europe due to competition from biosimilars. 

Hand stacking coins in ladder pattern on top of letter blocks that spell "health."

Image source: Getty Images.

In 2020, Humira brought in $3.72 billion in net revenue from international markets, a 13.6% year-over-year decrease, though sales in the U.S. were up 8.4% to $16.1 billion. Overall, the immunosuppressant recorded sales of $19.8 billion last year, a 3.5% increase over fiscal 2019.

Humira's total sales should continue growing, if ever so slightly, for at least a couple more years (biosimilars for the drug could enter the U.S. market in 2023). And even after it starts facing competition in the U.S., Humira will continue to contribute meaningfully to AbbVie's top line. 

What's more, the drugmaker has several other products it can count on to offset declining sales of this blockbuster. For instance, there is plaque psoriasis medicine Skyrizi, whose sales of $1.6 billion more than doubled last year compared to 2019. Also in 2020, sales of cancer medicine Imbruvica grew by 13.7% year over year to $5.3 billion.

And AbbVie's May 2020 acquisition of Allergan, a cash-and-stock transaction valued at $63 billion, helped the company diversify its revenue stream away from Humira. Allergan's Botox alone should bring in well over $1 billion in annual revenue for some time -- last year, it totaled about $2.5 billion from the time of the closing of the acquisition in May to the end of the year.

Management thinks biosimilars for Botox are unlikely anytime soon, with CEO Richard Gonzalez noting that "based on the uniqueness of this particular molecule ... it would be extremely difficult to create a biosimilar version of Botox. ... We looked at this very extensively with a lot of outside expertise, and we feel very confident that that's the case." 

Lastly, AbbVie's pipeline boasts well over two dozen ongoing clinical trials. The company is well positioned to add products to its lineup (or add new indications to existing products) every year. These factors all bode well for AbbVie, and even though the stock has underperformed the market in the past 12 months, investors willing to be patient would do well to consider buying shares of this pharma stock.

2. Pfizer 

The big story surrounding Pfizer in the past year has been its COVID-19 work, and with good reason. In December, the pharma giant earned an emergency use authorization (EUA) from the U.S. Food and Drug Administration for its coronavirus vaccine, BNT162b2, which it developed in collaboration with BioNTech. Pfizer will likely record well over a billion dollars in sales from it. 

And there is now good evidence that BNT162b2 is effective against new variants of the virus that causes COVID-19, especially the strain that first emerged in South Africa. Despite these factors, the market continues to undervalue Pfizer, and in the past year, the stock has severely underperformed the market. Pfizer currently trades for just 11.36 times forward earnings, while its PEG is a reasonable 0.9.

Doctor putting dollar bills in his front pocket.

Image source: Getty Images.

Pfizer could be an excellent value play as BNT162b2 helps boost revenue in the short term. And the company does have other long-term growth drivers; Pfizer's lineup is much broader than just one vaccine, including blockbuster products such as the anticoagulant Eliquis and the cancer drugs Ibrance and Xtandi, just to name a few.

In fiscal 2020, sales of Eliquis jumped by 17% year over year to $4.9 billion; revenue from Ibrance and Xtandi increased by 9% and 22%, respectively, to $5.4 billion and $1 billion. The company's total revenue from its biopharma segment -- which after the November spinoff of its off-patent Upjohn division is now its only operating business -- grew 7% in 2020 compared with fiscal 2019, despite some negative impact from the pandemic.

With this transaction in the rearview mirror, investors can expect even stronger sales growth once the coronavirus outbreak subsides. Pfizer's pipeline is filled with dozens of ongoing clinical trials, and the company plans to beef up its vaccine business by taking advantage of the experience it acquired through developing BNT162b2 in collaboration with BioNTech.

Considering all these factors, I believe Pfizer is well equipped to rebound from its comparatively poor performance over the past year, especially for investors willing to stay the course and hold its shares over the long haul.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.