Is Eagle Pharmaceuticals (EGRX) Stock Undervalued Right Now?
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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
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 to watch right now is Eagle Pharmaceuticals (EGRX). EGRX is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.
Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. EGRX has a P/S ratio of 0.94. This compares to its industry's average P/S of 1.57.
Finally, we should also recognize that EGRX has a P/CF ratio of 16.05. 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. This stock's P/CF looks attractive against its industry's average P/CF of 31.22. Within the past 12 months, EGRX's P/CF has been as high as 26.59 and as low as 6.66, with a median of 14.73.
If you're looking for another solid Medical - Products value stock, take a look at Koninklijke Philips (PHG). PHG is a # 1 (Strong Buy) stock with a Value score of A.
Koninklijke Philips is trading at a forward earnings multiple of 15.99 at the moment, with a PEG ratio of 0.94. This compares to its industry's average P/E of 21.18 and average PEG ratio of 2.59.
PHG's price-to-earnings ratio has been as high as 25.96 and as low as 9.44, with a median of 15.20, while its PEG ratio has been as high as 1.27 and as low as 0.85, with a median of 1, all within the past year.
Furthermore, Koninklijke Philips holds a P/B ratio of 1.43 and its industry's price-to-book ratio is 6.46. PHG's P/B has been as high as 1.62, as low as 0.67, with a median of 1.07 over the past 12 months.
Value investors will likely look at more than just these metrics, but the above data helps show that Eagle Pharmaceuticals and Koninklijke Philips are likely undervalued currently. And when considering the strength of its earnings outlook, EGRX and PHG sticks out as one of the market's strongest value stocks.
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Eagle Pharmaceuticals, Inc. (EGRX) : Free Stock Analysis Report
Koninklijke Philips N.V. (PHG) : Free Stock Analysis Report
