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Should Value Investors Buy Molina (MOH) Stock?

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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 fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company value investors might notice is Molina (MOH - Free Report) . MOH is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 14.16, which compares to its industry's average of 17.58. Over the past year, MOH's Forward P/E has been as high as 14.16 and as low as 9.07, with a median of 11.49.

Finally, we should also recognize that MOH has a P/CF ratio of 13.16. 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. MOH's P/CF compares to its industry's average P/CF of 14.76. Over the past 52 weeks, MOH's P/CF has been as high as 13.16 and as low as 7.78, with a median of 9.94.

These are just a handful of the figures considered in Molina's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that MOH is an impressive value stock right now.


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