Advertisement
Australia markets closed

  • ALL ORDS

    7,937.50
    -0.40 (-0.01%)
     

  • ASX 200

    7,683.00
    -0.50 (-0.01%)
     

  • AUD/USD

    0.6520
    +0.0020 (+0.31%)
     

  • OIL

    82.93
    +0.12 (+0.14%)
     

  • GOLD

    2,334.20
    -4.20 (-0.18%)
     

  • Bitcoin AUD

    98,077.50
    -4,230.48 (-4.14%)
     

  • CMC Crypto 200

    1,389.43
    +6.85 (+0.50%)
     

  • AUD/EUR

    0.6082
    +0.0012 (+0.19%)
     

  • AUD/NZD

    1.0951
    +0.0009 (+0.08%)
     

  • NZX 50

    11,946.43
    +143.15 (+1.21%)
     

  • NASDAQ

    17,526.80
    +55.33 (+0.32%)
     

  • FTSE

    8,078.58
    +38.20 (+0.48%)
     

  • Dow Jones

    38,460.92
    -42.77 (-0.11%)
     

  • DAX

    17,999.17
    -89.53 (-0.49%)
     

  • Hang Seng

    17,260.17
    +58.90 (+0.34%)
     

  • NIKKEI 225

    37,628.48
    -831.60 (-2.16%)
     

Should Value Investors Buy Cardinal Health (CAH) Stock?

Zacks Equity Research

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company value investors might notice is Cardinal Health (CAH). CAH is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with a P/E ratio of 10.42, which compares to its industry's average of 19.41. Over the past year, CAH's Forward P/E has been as high as 10.96 and as low as 8.12, with a median of 9.33.

ADVERTISEMENT

Investors should also note that CAH holds a PEG ratio of 1.69. 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. CAH's PEG compares to its industry's average PEG of 2.01. Over the past 52 weeks, CAH's PEG has been as high as 1.78 and as low as 1.31, with a median of 1.52.

These are just a handful of the figures considered in Cardinal Health'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 CAH is an impressive value stock right now.


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Cardinal Health, Inc. (CAH) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.