Overview Of Value Stocks In The Healthcare Sector

What are 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.

The following stocks are considered to be notable value stocks in the healthcare sector:

1. Quest Diagnostics DGX - P/E: 9.32
2. Ironwood Pharmaceuticals IRWD - P/E: 3.44
3. Metacrine MTCR - P/E: 1.22
4. Acutus Medical AFIB - P/E: 7.7
5. Timber Pharmaceuticals TMBR - P/E: 3.6

Quest Diagnostics has reported Q3 earnings per share at 3.96, which has increased by 24.53% compared to Q2, which was 3.18. The company's most recent dividend yield sits at 1.68%, which has increased by 0.01% from 1.67% last quarter.

This quarter, Ironwood Pharmaceuticals experienced a decrease in earnings per share, which was 0.34 in Q2 and is now 0.33. Ironwood Pharmaceuticals does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Most recently, Metacrine reported earnings per share at -0.69, whereas in Q2 earnings per share sat at -0.59. Metacrine does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Most recently, Acutus Medical reported earnings per share at -0.87, whereas in Q2 earnings per share sat at -0.89. Acutus Medical does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Timber Pharmaceuticals looks to be undervalued. It possesses an EPS of -0.08, which has not changed since last quarter (Q2). Timber Pharmaceuticals 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.