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Molina (MOH) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Molina (MOH) closed the most recent trading day at $140.13, moving -1.16% from the previous trading session. This change lagged the S&P 500's 0.09% loss on the day. At the same time, the Dow added 0.03%, and the tech-heavy Nasdaq lost 0.16%.

Coming into today, shares of the provider of Medicaid-related services had gained 3.47% in the past month. In that same time, the Medical sector gained 2.75%, while the S&P 500 gained 2.35%.

MOH will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $2.44, up 42.69% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $4.07 billion, down 12.42% from the year-ago period.

MOH's full-year Zacks Consensus Estimates are calling for earnings of $9.89 per share and revenue of $16.33 billion. These results would represent year-over-year changes of -6.79% and -13.56%, respectively.

It is also important to note the recent changes to analyst estimates for MOH. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 4.83% higher. MOH currently has a Zacks Rank of #2 (Buy).

In terms of valuation, MOH is currently trading at a Forward P/E ratio of 14.33. This represents a discount compared to its industry's average Forward P/E of 15.94.

It is also worth noting that MOH currently has a PEG ratio of 1.15. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Medical - HMOs was holding an average PEG ratio of 1.16 at yesterday's closing price.

The Medical - HMOs industry is part of the Medical sector. This group has a Zacks Industry Rank of 25, putting it in the top 10% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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