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SYNH or FCHS: Which Is the Better Value Stock Right Now?

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Investors interested in Medical Services stocks are likely familiar with Syneos Health and First Choice Healthcare Solutions, Inc. (FCHS - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Syneos Health and First Choice Healthcare Solutions, Inc. are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that SYNH has an improving earnings outlook. But this is only part of the picture for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

SYNH currently has a forward P/E ratio of 18.14, while FCHS has a forward P/E of 20.73. We also note that SYNH has a PEG ratio of 1.04. 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. FCHS currently has a PEG ratio of 1.38.

Another notable valuation metric for SYNH is its P/B ratio of 1.78. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, FCHS has a P/B of 3.06.

These are just a few of the metrics contributing to SYNH's Value grade of B and FCHS's Value grade of C.

SYNH is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that SYNH is likely the superior value option right now.


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