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Is Molina Healthcare (MOH) a Great Value Stock 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.

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.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One stock to keep an eye on is Molina Healthcare (MOH - Free Report) . MOH is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 9.08. This compares to its industry's average Forward P/E of 18.06. MOH's Forward P/E has been as high as 13.98 and as low as 6.48, with a median of 11.46, all within the past year.

Investors should also recognize that MOH has a P/B ratio of 2.06. 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. This company's current P/B looks solid when compared to its industry's average P/B of 2.69. Over the past year, MOH's P/B has been as high as 4.44 and as low as 1.79, with a median of 3.71.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a preferred metric because revenue can't really be manipulated, so sales are often a truer performance indicator. MOH has a P/S ratio of 0.23. This compares to its industry's average P/S of 0.33.

These are just a handful of the figures considered in Molina Healthcare'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 MOH is an impressive value stock right now.

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