Are Investors Undervaluing Option Care Health (OPCH) Right Now?

While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.

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 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.

One stock to keep an eye on is Option Care Health (OPCH). OPCH is currently holding a Zacks Rank #2 (Buy) and a Value grade of A. The stock has a Forward P/E ratio of 15.09. This compares to its industry's average Forward P/E of 19.27. OPCH's Forward P/E has been as high as 25.75 and as low as 14.74, with a median of 18.54, all within the past year.

Investors should also recognize that OPCH has a P/B ratio of 3.38. The P/B ratio pits a stock's market value against 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 4.76. Within the past 52 weeks, OPCH's P/B has been as high as 4.27 and as low as 2.59, with a median of 3.66.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. OPCH has a P/S ratio of 0.62. This compares to its industry's average P/S of 1.43.

Finally, investors should note that OPCH has a P/CF ratio of 15.67. 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. OPCH's P/CF compares to its industry's average P/CF of 33.33. Over the past 52 weeks, OPCH's P/CF has been as high as 21.37 and as low as 13.58, with a median of 18.42.

These are just a handful of the figures considered in Option Care Health'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 OPCH is an impressive value stock right now.

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This article originally published on Zacks Investment Research (zacks.com).

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