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MODV vs. GDRX: Which Stock Is the Better Value Option?

MODV vs. GDRX: Which Stock Is the Better Value Option?

This story originally appeared on Zacks

Investors interested in Medical Services stocks are likely familiar with ModivCare (MODV) and GoodRx Holdings, Inc. (GDRX). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

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Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, ModivCare has a Zacks Rank of #2 (Buy), while GoodRx Holdings, Inc. has a Zacks Rank of #4 (Sell). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that MODV has an improving earnings outlook. But this is only part of the picture for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

MODV currently has a forward P/E ratio of 29.88, while GDRX has a forward P/E of 102.28. We also note that MODV has a PEG ratio of 2.99. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. GDRX currently has a PEG ratio of 3.07.

Another notable valuation metric for MODV is its P/B ratio of 6.56. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, GDRX has a P/B of 16.97.

These metrics, and several others, help MODV earn a Value grade of B, while GDRX has been given a Value grade of D.

MODV is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that MODV is likely the superior value option right now.

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ModivCare Inc. (MODV): Free Stock Analysis Report


GoodRx Holdings, Inc. (GDRX): Free Stock Analysis Report


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