5 Value Stocks To Watch In The Healthcare Sector

Understanding Value Stocks

A value stock traditionally has a lower price when compared to stock prices of companies in the same industry. This indicates that the company may be undervalued, as investors are not expressing as much interest in such companies. The most commonly used way to check for value is with the price-to-earnings multiple, or P/E. A low P/E multiple is a good indication that the stock is undervalued.

Below is a list of notable value stocks in the healthcare sector:

1. Cigna CI - P/E: 9.93
2. Endo International ENDP - P/E: 8.72
3. Innoviva INVA - P/E: 5.72
4. Community Health Systems CYH - P/E: 4.2
5. Voyager Therapeutics VYGR - P/E: 2.97

Most recently, Cigna reported earnings per share at 4.73, whereas in Q4 earnings per share sat at 3.51. Its most recent dividend yield is at 1.75%, which has increased by 0.15% from 1.6% in the previous quarter.

Endo International saw a decrease in earnings per share from 0.75 in Q4 to 0.73 now. Endo International does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Innoviva saw an increase in earnings per share from 0.84 in Q1 to 0.9 now. Innoviva does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Community Health Systems saw a decrease in earnings per share from 0.36 in Q1 to 0.23 now. Community Health Systems does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Voyager Therapeutics's earnings per share for Q1 sits at -0.58, whereas in Q4, they were at -0.43. Voyager Therapeutics does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

The Significance: A value stock may need some time to rebound from its undervalued position. The risk of investing in a value stock is that this emergence may never materialize.