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Alberto Abaterusso
Alberto Abaterusso
Articles (2141) 

3 Stocks With Low Forward Price-Earnings Ratios

NextGen Healthcare Inc tops the list

May 24, 2020 | About:

To increase the likelihood to uncover value opportunities, investors may want to consider stocks with a favorable forward price-earnings ratio. The following stocks have a forward price-earnings ratio (based on Morningstar analysts' earnings estimates) that is lower than the S&P 500 index's historical average of 15.

NextGen Healthcare Inc

The first company under consideration is NextGen Healthcare Inc (NASDAQ:NXGN), an Irvine, California-based provider of healthcare software and services solutions to clinics in the U.S.

NextGen Healthcare has a forward price-earnings ratio of 13.4 (versus the industry median of 25.19), which results from Friday’s share price of $9.78 and analyst expectations of EPS of 73 cents for the next full fiscal year.

The stock price has decreased 49.4% in the past year for a market cap of $642.56 million and a 52-week range of $5.10 to $21.12.

GuruFocus has assigned a good rating of 7 out of 10 to the company’s financial strength and a positive rating of 6 out of 10 to its profitability.

The stock has a hold recommendation rating on Wall Street and an average target price of $11.46.

Perrigo Co PLC

The second company to consider is Perrigo Co PLC (NYSE:PRGO), an Irish manufacturer and supplier of over-the-counter health and wellbeing solutions in the U.S. and internationally.

Perrigo Co has a forward price-earnings ratio of 13.74 (versus the industry median of 18.69), which is the result of a share price of $54.28 as of May 22 and analyst expectations of $3.95 in EPS for the next full fiscal year.

The share price rose by 14.6% in the past year. The stock has a market capitalization of $7.4 billion and a 52-week range of $40.10 to $63.86.

GuruFocus has assigned a moderate rating of 4 out of 10 to the company’s financial strength and a positive rating of 6 out of 10 to its profitability.

The stock has an overweight recommendation rating on Wall Street and an average target price of $57.56.

Flex Ltd

The third company to consider is Flex Ltd (NASDAQ:FLEX), a Singapore-based provider of design, manufacturing and supply chain services to original equipment manufacturers worldwide.

Flex has a forward price-earnings ratio of 8.66 (versus the industry median of 16.25), which is the result of a share price of $9.61 as of May 22 and analyst expectations of EPS of $1.11 for the next full fiscal year.

The stock price has risen by almost 4% in the past year for a market cap of $4.84 billion and a 52-week range of $5.36 to $14.

GuruFocus has assigned a positive rating of 6 out of 10 to both the company’s financial strength and its profitability.

The stock has an overweight recommendation rating on Wall Street and an average target price of $12.69 per share.

Disclosure: I have no positions in any securities mentioned in this article.

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About the author:

Alberto Abaterusso
I am a contributor at GuruFocus. I primarily write about gold, silver and precious metals mining industries. My articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. I hold a Master's Degree in Business Administration from Università degli Studi di Bari (Italy), Aldo Moro. I am based in The Netherlands.

You can follow me on Twitter at https://twitter.com/AAbaterusso

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