Should Value Investors Buy DaVita (DVA) Stock?
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.
Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of 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.
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 DaVita (DVA). DVA is currently sporting a Zacks Rank of #1 (Strong Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 11.82. This compares to its industry's average Forward P/E of 19.74. Over the past 52 weeks, DVA's Forward P/E has been as high as 15.73 and as low as 9.57, with a median of 12.91.
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. DVA has a P/S ratio of 0.75. This compares to its industry's average P/S of 1.3.
Value investors will likely look at more than just these metrics, but the above data helps show that DaVita is likely undervalued currently. And when considering the strength of its earnings outlook, DVA sticks out at as one of the market's strongest value stocks.
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DaVita Inc. (DVA) : Free Stock Analysis Report
