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Are Investors Undervaluing Henry Schein (HSIC) Right Now?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

Henry Schein (HSIC - Free Report) is a stock many investors are watching right now. HSIC is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock is trading with P/E ratio of 18.76 right now. For comparison, its industry sports an average P/E of 19.51. Over the past year, HSIC's Forward P/E has been as high as 25.29 and as low as 16.46, with a median of 18.65.

Another notable valuation metric for HSIC is its P/B ratio of 2.80. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. HSIC's current P/B looks attractive when compared to its industry's average P/B of 5.99. HSIC's P/B has been as high as 2.92 and as low as 2.18, with a median of 2.52, over the past year.

Finally, we should also recognize that HSIC has a P/CF ratio of 18.21. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 50.77. Over the past 52 weeks, HSIC's P/CF has been as high as 19.02 and as low as 10.41, with a median of 15.83.

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


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