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MD vs. HQY: Which Stock Should Value Investors Buy Now?
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Investors with an interest in Medical Services stocks have likely encountered both Pediatrix Medical Group (MD - Free Report) and HealthEquity (HQY - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 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, Pediatrix Medical Group has a Zacks Rank of #1 (Strong Buy), while HealthEquity has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that MD is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
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 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.
MD currently has a forward P/E ratio of 8.88, while HQY has a forward P/E of 26.22. We also note that MD has a PEG ratio of 0.93. 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. HQY currently has a PEG ratio of 1.07.
Another notable valuation metric for MD is its P/B ratio of 1.54. 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, HQY has a P/B of 3.97.
These are just a few of the metrics contributing to MD's Value grade of A and HQY's Value grade of C.
MD 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 MD is likely the superior value option right now.
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MD vs. HQY: Which Stock Should Value Investors Buy Now?
Investors with an interest in Medical Services stocks have likely encountered both Pediatrix Medical Group (MD - Free Report) and HealthEquity (HQY - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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 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, Pediatrix Medical Group has a Zacks Rank of #1 (Strong Buy), while HealthEquity has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that MD is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
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 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.
MD currently has a forward P/E ratio of 8.88, while HQY has a forward P/E of 26.22. We also note that MD has a PEG ratio of 0.93. 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. HQY currently has a PEG ratio of 1.07.
Another notable valuation metric for MD is its P/B ratio of 1.54. 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, HQY has a P/B of 3.97.
These are just a few of the metrics contributing to MD's Value grade of A and HQY's Value grade of C.
MD 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 MD is likely the superior value option right now.