The following are the top rated Healthcare stocks according to Validea’s Earnings Yield Investor model based on the published strategy of Joel Greenblatt. This value model looks for companies with high return on capital and earnings yields.
HERBALIFE NUTRITION LTD (HLF) is a small-cap value stock in the Major Drugs industry. The rating according to our strategy based on Joel Greenblatt is 90% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Herbalife Nutrition Ltd. is a global nutrition company that provides health and wellness products. The Company sells weight management; targeted nutrition; energy, sports, and fitness; outer nutrition products; and literature and promotional items to and through a network of independent members. Its segments include North America, Mexico, South and Central America, EMEA, Asia Pacific, and China. Its weight management products include meal replacements, protein shakes, drink mixes, weight loss enhancers, and healthy snacks. Its targeted nutrition products include functional beverages and dietary and nutritional supplements containing herbs, vitamins, minerals, and other natural ingredients. Its energy, sports, and fitness category includes products that support a healthy active lifestyle. Its outer nutrition products include facial skin care, body care, and hair care. The Company’s literature and promotional items include start-up kits, sales tools, and educational materials.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | PASS |
Detailed Analysis of HERBALIFE NUTRITION LTD
ORGANON & CO (OGN) is a mid-cap value stock in the Biotechnology & Drugs industry. The rating according to our strategy based on Joel Greenblatt is 90% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Organon & Co. (Organon) is a global healthcare company. The Company is engaged in developing and delivering health solutions through a portfolio of prescription therapies within women’s health, biosimilars and established brands. Organon has a portfolio of contraception and fertility brands, such as Nexplanon or Implanon NXT, which is a patented long-acting reversible contraceptive. The Company’s Biosimilars portfolio spans across immunology and oncology treatments. It also has a portfolio of established brands, including brands in cardiovascular, respiratory, dermatology and non-opioid pain management. The Company sells these products primarily to drug wholesalers and retailers, hospitals, government agencies and managed health care providers such as health maintenance organizations, pharmacy benefit managers and other institutions. It operates approximately six manufacturing facilities, which are located in Belgium, Brazil, Indonesia, Mexico, the Netherlands and the United Kingdom.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | PASS |
Detailed Analysis of ORGANON & CO
ENHABIT INC (EHAB) is a small-cap value stock in the Healthcare Facilities industry. The rating according to our strategy based on Joel Greenblatt is 80% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Enhabit, Inc. provides a range of Medicare-certified skilled home health and hospice services. The Company operates through two segments: Home Health and Hospice. Its home health services include a range of Medicare-certified home nursing services to adult patients in need of care. These services include, among others, skilled nursing, physical, occupational, and speech therapy, medical social work, and home health aide services. Its hospice services include in-home services to terminally ill patients and their families to address patient’s physical needs, including pain control and symptom management, and to provide emotional and spiritual support. It operates home health agencies in approximately 34 states, with a concentration in the southern half of the United States. It operates approximately 250 home health agencies. It operates home health agencies in about 34 states, with a concentration in the southern half of the United States. The Company operates about 100 hospice agencies.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | FAIL |
Detailed Analysis of ENHABIT INC
QUIDELORTHO CORP (QDEL) is a mid-cap value stock in the Healthcare Facilities industry. The rating according to our strategy based on Joel Greenblatt is 80% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: QuidelOrtho Corporation is a vitro diagnostics company. The Company is engaged in the development and manufacturing of advanced technologies in diagnostic testing. Its capabilities include immunoassay and molecular testing, clinical chemistry and transfusion medicine. The Company’s business units include Labs, Molecular Diagnostics, Point of Care, and Transfusion Medicine. Its Labs business unit includes Virology, Specialty Products, Specialty Products, Immunodiagnostics, VITROS Platform, XT Platform, VITROS XT Platform, and VITROS Automation Solutions. Its Molecular Diagnostics business includes Lyra, Solana, and Savanna. It provides diagnostic testing solutions under various brand names, including AdenoPlus, BIOVUE, D, ELVIRA, ELVIS, FastPoint, FreshCells, InflammaDry, Lyra, MicroVue, Ortho, Ortho Clinical Diagnostics, Ortho Vision, Quidel, QuickVue, QuickVue+, QVue, ReadyCells, Savanna, Sofia, Solana, Thyretain, Triage, Virena, and Vitros.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | FAIL |
Detailed Analysis of QUIDELORTHO CORP
MOLINA HEALTHCARE INC (MOH) is a large-cap growth stock in the Healthcare Facilities industry. The rating according to our strategy based on Joel Greenblatt is 70% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Molina Healthcare, Inc. is a provider of managed healthcare services under the Medicaid and Medicare programs, and through the state insurance marketplaces. The Company operates through four segments: Medicaid, Medicare, Marketplace, and Other. The Medicaid, Medicare, and Marketplace segments represent the government-funded or sponsored programs under which the Company offers managed healthcare services. Medicaid provides healthcare and long-term care services and support to low-income Americans. Medicare is a federal program that provides eligible persons aged 65 and over and some disabled persons with a variety of hospital, medical insurance, and prescription drug benefits. Marketplace insurance exchanges allow individuals and small groups to purchase federally subsidized health insurance. The Company arranges healthcare services for its members through contracts with a network of providers, including independent physicians and physician groups, hospitals, and ancillary providers.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | FAIL |
Detailed Analysis of MOLINA HEALTHCARE INC
QUEST DIAGNOSTICS INC (DGX) is a large-cap growth stock in the Healthcare Facilities industry. The rating according to our strategy based on Joel Greenblatt is 50% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Quest Diagnostics Incorporated is a provider of diagnostic information services. The Company operates through the DIS segment, which provides diagnostic information services to a range of customers, including patients, clinicians, hospitals, independent delivery networks (IDNs), health plans, employers, consumers, and accountable care organizations (ACOs). It is also engaged in two business operations, Diagnostic Information Services, which develops and delivers diagnostic information services that provide insights to a range of customers, and the Diagnostic Solutions group includes its risk assessment services business, which offers solutions for insurers, and its healthcare information technology business, which offers solutions for healthcare providers. The Company’s services are primarily provided under the Quest Diagnostics brand and also provide services under other brands, including AmeriPath, Dermpath Diagnostics, ExamOne, and Quanum.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | FAIL |
Detailed Analysis of QUEST DIAGNOSTICS INC
AMEDISYS INC (AMED) is a mid-cap growth stock in the Healthcare Facilities industry. The rating according to our strategy based on Joel Greenblatt is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Amedisys, Inc. is a healthcare services company that provides care and support in the home. The Company’s operations involve serving patients through its four operating divisions: home health, hospice, personal care, and high acuity care. The home health segment provides healthcare to help its patients recover from surgery or illness, live with chronic diseases and prevent avoidable hospital readmissions. The segment provides care teams that consists of skilled nurses, care for wounds, monitor vital signs and provide a range of other nursing services. The Hospice segment provides comfort and support for customers who are dealing with a terminal illness. The Personal Care segment provides patients with assistance with the essential activities of daily living. Its high acuity care segment delivers the essential elements of inpatient hospital and skilled nursing facility (SNF) care to patients in their homes. The Company owns and operates approximately 532 care centers in 37 states.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | FAIL |
Detailed Analysis of AMEDISYS INC
INMODE LTD (INMD) is a mid-cap growth stock in the Medical Equipment & Supplies industry. The rating according to our strategy based on Joel Greenblatt is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Inmode Ltd is an Israel-based global provider of energy-based, minimally-invasive surgical medical treatment solutions. Company’s products and solutions are primarily designed to address three energy-based treatment categories comprised of: face and body contouring; medical aesthetics; and women’s health. The Company have developed and commercialized products utilizing medically-accepted RF energy technology, which can penetrate deep into the subdermal fat, allowing adipose tissue remodeling. It’s RF energy-based proprietary technologies – Radio Frequency Assisted Lipolysis (RFAL), Deep Subdermal Fractional RF, Simultaneous Fat Destruction and Skin Tightening and Deep Heating Collagen Remodeling for skin and human natural openings- represent a paradigm shift in the minimally-invasive aesthetic solutions market. These technologies are used by physicians to remodel subdermal adipose, or fatty tissue in a variety of procedures.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | FAIL |
Detailed Analysis of INMODE LTD
IRONWOOD PHARMACEUTICALS, INC. (IRWD) is a small-cap value stock in the Biotechnology & Drugs industry. The rating according to our strategy based on Joel Greenblatt is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Ironwood Pharmaceuticals, Inc. is a gastrointestinal (GI) healthcare company, which is advancing the treatment of GI diseases and redefining the standard of care for GI patients. It develops and commercializes GI product opportunities in areas of significant unmet need, leveraging its demonstrated expertise and capabilities in GI diseases. LINZESS (linaclotide), its commercial product, in a class of GI medicines called guanylate cyclase type C agonists (GC-C agonists) and is indicated for adult men and women suffering from irritable bowel syndrome with constipation (IBS-C), or chronic idiopathic constipation (CIC). LINZESS is available to adult men and women suffering from IBS-C or CIC in the United States and Mexico, IBS-C or chronic constipation in Japan, and IBS-C in China. Linaclotide is available under the trademarked name CONSTELLA to adult men and women suffering from IBS-C or CIC in Canada, and to adult men and women suffering from IBS-C in certain European countries.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | FAIL |
Detailed Analysis of IRONWOOD PHARMACEUTICALS, INC.
LABORATORY CORP. OF AMERICA HOLDINGS (LH) is a large-cap growth stock in the Healthcare Facilities industry. The rating according to our strategy based on Joel Greenblatt is 40% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Laboratory Corporation of America Holdings is a global life sciences company. The Company provides information to help doctors, hospitals, pharmaceutical companies, researchers, and patients make decisions. Its segments include Labcorp Diagnostics (Dx) and Labcorp Drug Development (DD). The Dx segment is an independent clinical laboratory business. It offers a menu of frequently requested and specialty diagnostic tests through an integrated network of primary and specialty laboratories across the United States. In addition to diagnostic testing along with occupational and wellness testing for employers and forensic DNA analysis, Dx segment also offers a range of other testing services. The DD segment is a contract research organizations (CRO) business that provides end-to-end drug development services. The DD segment provides these services predominantly to pharmaceutical, biotechnology and medical device companies across the world. It serves clients in more than 100 countries.
The following table summarizes whether the stock meets each of this strategy’s tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy’s criteria.
| EARNINGS YIELD: | NEUTRAL |
| RETURN ON TANGIBLE CAPITAL: | NEUTRAL |
| FINAL RANKING: | FAIL |
Detailed Analysis of LABORATORY CORP. OF AMERICA HOLDINGS
About Joel Greenblatt: In his 2005 bestseller The Little Book That Beats The Market, hedge fund manager Joel Greenblatt laid out a stunningly simple way to beat the market using two — and only two — fundamental variables. The “Magic Formula,” as he called it, produced back-tested returns of 30.8 percent per year from 1988 through 2004, more than doubling the S&P 500’s 12.4 percent return during that time. Greenblatt also produced exceptional returns as managing partner at Gotham Capital, a New York City-based hedge fund he founded. The firm averaged a remarkable 40 percent annualized return over more than two decades.
About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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