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Are Investors Undervaluing Humana (HUM) Right Now?
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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is Humana (HUM - Free Report) . HUM is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 18.45, which compares to its industry's average of 19.29. HUM's Forward P/E has been as high as 22.63 and as low as 15.20, with a median of 17.92, all within the past year.
Another valuation metric that we should highlight is HUM's P/B ratio of 4.11. 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 4.57. Within the past 52 weeks, HUM's P/B has been as high as 4.12 and as low as 2.90, with a median of 3.64.
Finally, our model also underscores that HUM has a P/CF ratio of 16.27. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 18.22. HUM's P/CF has been as high as 18.09 and as low as 12.81, with a median of 15.52, all within the past year.
Another great Medical - HMOs stock you could consider is Molina Healthcare (MOH - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.
Molina Healthcare is currently trading with a Forward P/E ratio of 17.90 while its PEG ratio sits at 1.07. Both of the company's metrics compare favorably to its industry's average P/E of 19.29 and average PEG ratio of 1.33.
Over the past year, MOH's P/E has been as high as 23.62, as low as 13.75, with a median of 17.46; its PEG ratio has been as high as 1.12, as low as 0.74, with a median of 1.31 during the same time period.
Additionally, Molina Healthcare has a P/B ratio of 7.16 while its industry's price-to-book ratio sits at 4.57. For MOH, this valuation metric has been as high as 7.63, as low as 5.29, with a median of 6.78 over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Humana and Molina Healthcare are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, HUM and MOH feels like a great value stock at the moment.
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Are Investors Undervaluing Humana (HUM) Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One stock to keep an eye on is Humana (HUM - Free Report) . HUM is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 18.45, which compares to its industry's average of 19.29. HUM's Forward P/E has been as high as 22.63 and as low as 15.20, with a median of 17.92, all within the past year.
Another valuation metric that we should highlight is HUM's P/B ratio of 4.11. 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 4.57. Within the past 52 weeks, HUM's P/B has been as high as 4.12 and as low as 2.90, with a median of 3.64.
Finally, our model also underscores that HUM has a P/CF ratio of 16.27. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 18.22. HUM's P/CF has been as high as 18.09 and as low as 12.81, with a median of 15.52, all within the past year.
Another great Medical - HMOs stock you could consider is Molina Healthcare (MOH - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.
Molina Healthcare is currently trading with a Forward P/E ratio of 17.90 while its PEG ratio sits at 1.07. Both of the company's metrics compare favorably to its industry's average P/E of 19.29 and average PEG ratio of 1.33.
Over the past year, MOH's P/E has been as high as 23.62, as low as 13.75, with a median of 17.46; its PEG ratio has been as high as 1.12, as low as 0.74, with a median of 1.31 during the same time period.
Additionally, Molina Healthcare has a P/B ratio of 7.16 while its industry's price-to-book ratio sits at 4.57. For MOH, this valuation metric has been as high as 7.63, as low as 5.29, with a median of 6.78 over the past year.
These figures are just a handful of the metrics value investors tend to look at, but they help show that Humana and Molina Healthcare are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, HUM and MOH feels like a great value stock at the moment.