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Is Tenet Healthcare (THC) a Great Value Stock Right Now?

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

One company to watch right now is Tenet Healthcare (THC). THC is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 8.61, while its industry has an average P/E of 11.75. Over the past year, THC's Forward P/E has been as high as 13.49 and as low as 7.24, with a median of 11.57.

Investors will also notice that THC has a PEG ratio of 1.02. 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. THC's industry has an average PEG of 1.11 right now. Over the last 12 months, THC's PEG has been as high as 8.73 and as low as 0.94, with a median of 4.52.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. THC has a P/S ratio of 0.33. This compares to its industry's average P/S of 0.44.

Finally, our model also underscores that THC has a P/CF ratio of 3.76. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. THC's P/CF compares to its industry's average P/CF of 4.81. Over the past 52 weeks, THC's P/CF has been as high as 5.87 and as low as 3.17, with a median of 4.23.

These are just a handful of the figures considered in Tenet Healthcare's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that THC is an impressive value stock right now.


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