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Are Investors Undervaluing Centene (CNC) Right Now?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company to watch right now is Centene (CNC - Free Report) . CNC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 11.74, which compares to its industry's average of 14.80. CNC's Forward P/E has been as high as 14.43 and as low as 9.20, with a median of 12.25, all within the past year.
Investors should also note that CNC holds a PEG ratio of 0.83. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. CNC's PEG compares to its industry's average PEG of 1.10. Within the past year, CNC's PEG has been as high as 1 and as low as 0.64, with a median of 0.84.
Another notable valuation metric for CNC is its P/B ratio of 1.51. 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. This company's current P/B looks solid when compared to its industry's average P/B of 3.46. CNC's P/B has been as high as 2.23 and as low as 1.25, with a median of 1.62, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CNC has a P/S ratio of 0.42. This compares to its industry's average P/S of 0.66.
Finally, investors should note that CNC has a P/CF ratio of 13.88. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 14.45. Within the past 12 months, CNC's P/CF has been as high as 21.26 and as low as 8.58, with a median of 12.63.
These are just a handful of the figures considered in Centene's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that CNC is an impressive value stock right now.
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Are Investors Undervaluing Centene (CNC) Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.
One company to watch right now is Centene (CNC - Free Report) . CNC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with a P/E ratio of 11.74, which compares to its industry's average of 14.80. CNC's Forward P/E has been as high as 14.43 and as low as 9.20, with a median of 12.25, all within the past year.
Investors should also note that CNC holds a PEG ratio of 0.83. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. CNC's PEG compares to its industry's average PEG of 1.10. Within the past year, CNC's PEG has been as high as 1 and as low as 0.64, with a median of 0.84.
Another notable valuation metric for CNC is its P/B ratio of 1.51. 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. This company's current P/B looks solid when compared to its industry's average P/B of 3.46. CNC's P/B has been as high as 2.23 and as low as 1.25, with a median of 1.62, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. CNC has a P/S ratio of 0.42. This compares to its industry's average P/S of 0.66.
Finally, investors should note that CNC has a P/CF ratio of 13.88. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 14.45. Within the past 12 months, CNC's P/CF has been as high as 21.26 and as low as 8.58, with a median of 12.63.
These are just a handful of the figures considered in Centene's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that CNC is an impressive value stock right now.