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SEM vs. UNH: Which Stock Should Value Investors Buy Now?
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Investors with an interest in Medical - HMOs stocks have likely encountered both Select Medical (SEM - Free Report) and UnitedHealth Group (UNH - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Currently, Select Medical has a Zacks Rank of #2 (Buy), while UnitedHealth Group has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that SEM likely has seen a stronger improvement to its earnings outlook than UNH has recently. But this is just one piece of the puzzle for value investors.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.
SEM currently has a forward P/E ratio of 11.33, while UNH has a forward P/E of 18.34. We also note that SEM has a PEG ratio of 0.76. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. UNH currently has a PEG ratio of 1.47.
Another notable valuation metric for SEM is its P/B ratio of 2.24. 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, UNH has a P/B of 4.73.
Based on these metrics and many more, SEM holds a Value grade of A, while UNH has a Value grade of C.
SEM 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 SEM is likely the superior value option right now.
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SEM vs. UNH: Which Stock Should Value Investors Buy Now?
Investors with an interest in Medical - HMOs stocks have likely encountered both Select Medical (SEM - Free Report) and UnitedHealth Group (UNH - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Currently, Select Medical has a Zacks Rank of #2 (Buy), while UnitedHealth Group has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that SEM likely has seen a stronger improvement to its earnings outlook than UNH has recently. But this is just one piece of the puzzle for value investors.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies 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.
SEM currently has a forward P/E ratio of 11.33, while UNH has a forward P/E of 18.34. We also note that SEM has a PEG ratio of 0.76. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. UNH currently has a PEG ratio of 1.47.
Another notable valuation metric for SEM is its P/B ratio of 2.24. 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, UNH has a P/B of 4.73.
Based on these metrics and many more, SEM holds a Value grade of A, while UNH has a Value grade of C.
SEM 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 SEM is likely the superior value option right now.