Back to top

Image: Bigstock

CON or MEDP: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors looking for stocks in the Medical Services sector might want to consider either Concentra Group (CON - Free Report) or Medpace (MEDP - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, Concentra Group has a Zacks Rank of #2 (Buy), while Medpace has a Zacks Rank of #3 (Hold). This means that CON's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

CON currently has a forward P/E ratio of 19.72, while MEDP has a forward P/E of 30.93. We also note that CON has a PEG ratio of 1.37. 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. MEDP currently has a PEG ratio of 2.67.

Another notable valuation metric for CON is its P/B ratio of 8.97. 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. By comparison, MEDP has a P/B of 25.16.

These metrics, and several others, help CON earn a Value grade of B, while MEDP has been given a Value grade of D.

CON sticks out from MEDP in both our Zacks Rank and Style Scores models, so value investors will likely feel that CON is the better option right now.

Published in