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Are Investors Undervaluing AmerisourceBergen (ABC) 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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 company to watch right now is AmerisourceBergen . ABC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 13.31 right now. For comparison, its industry sports an average P/E of 17.78. Over the past 52 weeks, ABC's Forward P/E has been as high as 14.90 and as low as 11.77, with a median of 13.29.
Investors should also note that ABC holds a PEG ratio of 1.52. 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. ABC's PEG compares to its industry's average PEG of 1.58. Over the last 12 months, ABC's PEG has been as high as 1.82 and as low as 1.43, with a median of 1.59.
Finally, investors will want to recognize that ABC has a P/CF ratio of 13.08. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 18.77. Over the past 52 weeks, ABC's P/CF has been as high as 14.86 and as low as 10.91, with a median of 13.24.
Another great Medical - Dental Supplies stock you could consider is McKesson (MCK - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.
McKesson is currently trading with a Forward P/E ratio of 13.73 while its PEG ratio sits at 1.33. Both of the company's metrics compare favorably to its industry's average P/E of 17.78 and average PEG ratio of 1.58.
Over the last 12 months, MCK's P/E has been as high as 15.66, as low as 11.69, with a median of 14.02, and its PEG ratio has been as high as 1.56, as low as 0.99, with a median of 1.43.
Additionally, McKesson has a P/B ratio of -23.62 while its industry's price-to-book ratio sits at 6.31. For MCK, this valuation metric has been as high as -23.48, as low as -59.10, with a median of -33.35 over the past year.
These are only a few of the key metrics included in AmerisourceBergen and McKesson strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, ABC and MCK look like an impressive value stock at the moment.
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Are Investors Undervaluing AmerisourceBergen (ABC) 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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.
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 company to watch right now is AmerisourceBergen . ABC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 13.31 right now. For comparison, its industry sports an average P/E of 17.78. Over the past 52 weeks, ABC's Forward P/E has been as high as 14.90 and as low as 11.77, with a median of 13.29.
Investors should also note that ABC holds a PEG ratio of 1.52. 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. ABC's PEG compares to its industry's average PEG of 1.58. Over the last 12 months, ABC's PEG has been as high as 1.82 and as low as 1.43, with a median of 1.59.
Finally, investors will want to recognize that ABC has a P/CF ratio of 13.08. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 18.77. Over the past 52 weeks, ABC's P/CF has been as high as 14.86 and as low as 10.91, with a median of 13.24.
Another great Medical - Dental Supplies stock you could consider is McKesson (MCK - Free Report) , which is a # 2 (Buy) stock with a Value Score of A.
McKesson is currently trading with a Forward P/E ratio of 13.73 while its PEG ratio sits at 1.33. Both of the company's metrics compare favorably to its industry's average P/E of 17.78 and average PEG ratio of 1.58.
Over the last 12 months, MCK's P/E has been as high as 15.66, as low as 11.69, with a median of 14.02, and its PEG ratio has been as high as 1.56, as low as 0.99, with a median of 1.43.
Additionally, McKesson has a P/B ratio of -23.62 while its industry's price-to-book ratio sits at 6.31. For MCK, this valuation metric has been as high as -23.48, as low as -59.10, with a median of -33.35 over the past year.
These are only a few of the key metrics included in AmerisourceBergen and McKesson strong Value grade, but they help show that the stocks are likely undervalued right now. When factoring in the strength of its earnings outlook, ABC and MCK look like an impressive value stock at the moment.