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Here's Why AmerisourceBergen (ABC) is a Strong Value Stock

Zacks Equity Research
·2 min read

For new and old investors, taking full advantage of the stock market and investing with confidence are common goals.

Many investors also have a go-to methodology that helps guide their buy and sell decisions. One way to find winning stocks based on your preferred way of investing is to use the Zacks Style Scores, which are indicators that rate stocks based on three widely-followed investing types: value, growth, and momentum.

Why Investors Should Pay Attention to This Value Stock

Finding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to highlight the most attractive and discounted stocks.

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AmerisourceBergen (ABC)

Chesterbrook, PA-based AmerisourceBergen is one of the world’s largest pharmaceutical services companies, which focuses on providing drug distribution and related services to reduce health care costs and improve patient outcomes.

ABC is a Zacks Rank #2 (Buy) stock, with a Value Style Score of A and VGM Score of A. Shares are currently trading at a forward P/E of 13.7X for the current fiscal year compared to the Medical - Dental Supplies industry's P/E of 21.1X. Additionally, ABC has a PEG Ratio of 1.6 and a Price/Cash Flow ratio of 10.5X. Value investors should also note ABC's Price/Sales ratio of 0.1X.

A company's earnings performance is important for value investors as well. For fiscal 2023, four analysts revised their earnings estimate higher in the last 60 days for ABC, while the Zacks Consensus Estimate has increased $0.10 to $11.59 per share. ABC also holds an average earnings surprise of 3.5%.

Investors should take the time to consider ABC for their portfolios due to its solid Zacks Ranks, notable earnings and valuation metrics, and impressive Value and VGM Style Scores.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

AmerisourceBergen Corporation (ABC) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research