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Is WellCare Health Plans (WCG) Stock Undervalued Right Now?

Zacks Equity Research
Iron Mountain (IRM) closed at $30.54 in the latest trading session, marking a +1.29% move from the prior day.

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader 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.

WellCare Health Plans (WCG) is a stock many investors are watching right now. WCG is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A.

Investors will also notice that WCG has a PEG ratio of 1.07. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. WCG's PEG compares to its industry's average PEG of 1.14. WCG's PEG has been as high as 1.77 and as low as 0.98, with a median of 1.38, all within the past year.

Investors should also recognize that WCG has a P/B ratio of 2.83. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 3.37. Within the past 52 weeks, WCG's P/B has been as high as 5.37 and as low as 2.66, with a median of 3.63.

These figures are just a handful of the metrics value investors tend to look at, but they help show that WellCare Health Plans is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, WCG feels like a great value stock at the moment.


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