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First Choice Healthcare Solutions, Inc. (FCHS) - free report >>
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First Choice Healthcare Solutions, Inc. (FCHS) - free report >>
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SYNH or FCHS: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Medical Services sector have probably already heard of Syneos Health and First Choice Healthcare Solutions, Inc. (FCHS - 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Syneos Health has a Zacks Rank of #2 (Buy), while First Choice Healthcare Solutions, Inc. has a Zacks Rank of #4 (Sell) right now. Investors should feel comfortable knowing that SYNH likely has seen a stronger improvement to its earnings outlook than FCHS has recently. 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
SYNH currently has a forward P/E ratio of 19.22, while FCHS has a forward P/E of 20.55. We also note that SYNH has a PEG ratio of 1.10. 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 1.37.
Another notable valuation metric for SYNH is its P/B ratio of 1.70. 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. By comparison, FCHS has a P/B of 3.03.
These metrics, and several others, help SYNH earn a Value grade of B, while FCHS has been given a Value grade of D.
SYNH stands above FCHS thanks to its solid earnings outlook, and based on these valuation figures, we also feel that SYNH is the superior value option right now.