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Molina (MOH) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research
In the latest trading session, Rent-A-Center (RCII) closed at $25.89, marking a -0.23% move from the previous day.

Molina (MOH) closed the most recent trading day at $138.57, moving +1.62% from the previous trading session. This change outpaced the S&P 500's 0.47% gain on the day. Elsewhere, the Dow gained 0.68%, while the tech-heavy Nasdaq added 0.74%.

Prior to today's trading, shares of the provider of Medicaid-related services had gained 15.81% over the past month. This has outpaced the Medical sector's gain of 5.76% and the S&P 500's gain of 7.71% in that time.

MOH will be looking to display strength as it nears its next earnings release, which is expected to be February 11, 2019. The company is expected to report EPS of $1.52, up 347.06% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.56 billion, down 7.83% from the prior-year quarter.

Investors might also notice recent changes to analyst estimates for MOH. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 3.94% higher. MOH is currently sporting a Zacks Rank of #1 (Strong Buy).

Investors should also note MOH's current valuation metrics, including its Forward P/E ratio of 14.7. This represents a discount compared to its industry's average Forward P/E of 15.86.

We can also see that MOH currently has a PEG ratio of 1.18. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Medical - HMOs industry currently had an average PEG ratio of 1.19 as of yesterday's close.

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 gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. 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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