Dj Dir Ordan Registers 27600 Of Pediatrix Medical Group Inc >Md

It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Luckily, Zacks Premium offers several different ways to do both.

Featuring daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, the research service can help you become a smarter, more self-assured investor.

It also includes access to the Zacks Style Scores.

What are the Zacks Style Scores?

The Zacks Style Scores is a unique set of guidelines that rates stocks based on three popular investing types, and were developed as complementary indicators for the Zacks Rank. This combination helps investors choose securities with the highest chances of beating the market over the next 30 days.

Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.

The Style Scores are broken down into four categories:

Value Score

Value investors love finding good stocks at good prices, especially before the broader market catches on to a stock's true value. Utilizing ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and many other multiples, the Value Style Score identifies the most attractive and most discounted stocks.

Growth Score

Growth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.

Momentum Score

Momentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.

VGM Score

If you want a combination of all three Style Scores, then the VGM Score will be your friend. It rates each stock on their combined weighted styles, helping you find the companies with the most attractive value, best growth forecast, and most promising momentum. It's also one of the best indicators to use with the Zacks Rank.

How Style Scores Work with the Zacks Rank

A proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.

#1 (Strong Buy) stocks have produced an unmatched +25.41% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.

But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.

That's where the Style Scores come in.

To maximize your returns, you want to buy stocks with the highest probability of success. This means picking stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you find yourself looking at stocks with a #3 (Hold) rank, make sure they have Scores of A or B as well to ensure as much upside potential as possible.

The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.

For instance, a stock with a #4 (Sell) or #5 (Strong Sell) rating, even one that boasts Scores of A and B, still has a downward-trending earnings forecast, and a much greater likelihood its share price will decline as well.

Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: Pediatrix Medical Group (MD)

Headquartered in Sunrise, FL, Pediatrix Medical Group, Inc. changed its corporate name from Mednax, effective Jul 1, 2022, to improve brand awareness. It continues trading under its current ticker symbol, MD.

MD is a #1 (Strong Buy) on the Zacks Rank, with a VGM Score of A.

Momentum investors should take note of this Medical stock. MD has a Momentum Style Score of B, and shares are up 33.7% over the past four weeks.

Five analysts revised their earnings estimate higher in the last 60 days for fiscal 2024, while the Zacks Consensus Estimate has increased $0.07 to $1.34 per share. MD also boasts an average earnings surprise of 9.9%.

With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, MD should be on investors' short list.

Zacks Investment Research

Momentum investing is essentially the opposite of the tried-and-tested Wall Street adage -- "buy low and sell high." Investors following this investing style typically avoid betting on cheap stocks and waiting long for them to recover. They believe instead that one could make far more money in lesser time by "buying high and selling higher."

Who doesn't like betting on fast-moving trending stocks? But determining the right entry point isn't easy. Often, these stocks lose momentum once their valuation moves ahead of their future growth potential. In such a situation, investors find themselves loaded up on expensive shares with limited to no upside or even a downside. So, going all-in on momentum could be risky at times.

A safer approach could be investing in bargain stocks with recent price momentum. While the Zacks Momentum Style Score (part of the Zacks Style Scores system) helps identify great momentum stocks by paying close attention to trends in a stock's price or earnings, our 'Fast-Paced Momentum at a Bargain' screen comes handy in spotting fast-moving stocks that are still attractively priced.

There are several stocks that currently pass through the screen and Pediatrix Medical Group (MD) is one of them. Here are the key reasons why this stock is a great candidate.

A dash of recent price momentum reflects growing interest of investors in a stock. With a four-week price change of 33.7%, the stock of this physician group is certainly well-positioned in this regard.

While any stock can see a spike in price for a short period, it takes a real momentum player to deliver positive returns for a longer time frame. MD meets this criterion too, as the stock gained 55.7% over the past 12 weeks.

Moreover, the momentum for MD is fast paced, as the stock currently has a beta of 1.55. This indicates that the stock moves 55% higher than the market in either direction.

Given this price performance, it is no surprise that MD has a Momentum Score of B, which indicates that this is the right time to enter the stock to take advantage of the momentum with the highest probability of success.

In addition to a favorable Momentum Score, an upward trend in earnings estimate revisions has helped MD earn a Zacks Rank #1 (Strong Buy). Our research shows that the momentum-effect is quite strong among Zacks Rank #1 and #2 stocks. That's because as covering analysts raise their earnings estimates for a stock, more and more investors take an interest in it, helping its price race to keep up. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here

Most importantly, despite possessing fast-paced momentum features, MD is trading at a reasonable valuation. In terms of Price-to-Sales ratio, which is considered as one of the best valuation metrics, the stock looks quite cheap now. MD is currently trading at 0.69 times its sales. In other words, investors need to pay only 69 cents for each dollar of sales.

So, MD appears to have plenty of room to run, and that too at a fast pace.

In addition to MD, there are several other stocks that currently pass through our 'Fast-Paced Momentum at a Bargain' screen. You may consider investing in them and start looking for the newest stocks that fit these criteria.

This is not the only screen that could help you find your next winning stock pick. Based on your personal investing style, you may choose from over 45 Zacks Premium Screens that are strategically created to beat the market.

However, keep in mind that the key to a successful stock-picking strategy is to ensure that it produced profitable results in the past. You could easily do that with the help of the Zacks Research Wizard. In addition to allowing you to backtest the effectiveness of your strategy, the program comes loaded with some of our most successful stock-picking strategies.

Click here to sign up for a free trial to the Research Wizard today.

Zacks Investment Research

Pediatrix Medical Group, Inc. MD shares have jumped 30.5% since it reported strong third-quarter results on Nov. 1, 2024. The company benefited from growth in same-unit revenues and improved hospital contract administrative fees. However, the upside was partly offset by an increased expense level.

Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.

MD reported third-quarter 2024 adjusted earnings per share (EPS) of 44 cents, which outpaced the Zacks Consensus Estimate by 18.9%. Also, the bottom line jumped 37.5% year over year.

Net revenues inched up 0.9% year over year to $511.2 million. The top line beat the consensus mark by 2.2%.

Pediatrix Medical Group, Inc. Price, Consensus and EPS Surprise

Pediatrix Medical Group, Inc. price-consensus-eps-surprise-chart | Pediatrix Medical Group, Inc. Quote

Q3 Update for MD

Overall, same-unit revenues increased 5.2% year over year, beating the Zacks Consensus Estimate of 1.65%. Same-unit revenues, attributable to patient volume, grew 1.8% year over year.

Same-unit revenues from net reimbursement-related factors inched up 3.4%, attributable to modest growth in hospital contract administrative fees and improved payor mix. It beat the Zacks Conesus Estimate of 0.95%.

Net patient service revenue of $438.7 million grew 0.3% year over year and beat the consensus mark by 0.9%. Hospital contract administrative fees of $72.4 million grew 5.4% from a year ago and beat the estimates by 0.2%.

Pediatrix Medical’s total operating costs of $477.3 million increased 2.4% year over year. The rise was due to higher G&A expenses and the incurrence of transformational and restructuring-related expenses in the third quarter.

Practice salaries and benefits decreased 1% on a year-over-year basis. This is mainly due to declining same-unit medical malpractice expenses and the impact of practice dispositions, partially offset by growth in same-unit clinical compensation costs. Interest expenses of $10.1 million decreased 2.4% year over year.

Pediatrix Medical’s net income of $19.4 million declined from $21.4 million in the year-ago period.

Adjusted EBITDA jumped 19.5% year over year to $60.2 million.

MD’s Financial Update (as of Sept. 30, 2024)

Pediatrix Medical exited the third quarter with cash and cash equivalents of $103.8 million compared with $73.3 million at 2023-end. There were no outstanding borrowingson its revolving credit facility at the quarter-end.

Total assets of $2.08 billion slipped from the $2.22 billion figure at 2023-end.

Total debt, including finance leases, net, amounted to $626.7 million, which declined from the $633.3 million figure as of Dec. 31, 2023.

Total shareholders’ equity of $732.5 million declined from the 2023-end level of $849.1 million.

Operating cash flow was $95.7 million, up from $81.1 million in the prior-year quarter.

Share Repurchase Update for MD

Pediatrix Medical bought back a nominal number of its common shares for $1.1 million in the first nine months of 2024. It had a leftover capacity of $3.5 million under its $500 million repurchase program (approved in August 2018) as of Sept. 30, 2024.

MD’s 2024 View Revised

Management forecasts adjusted EBITDA between $205 million and $215 million for 2024. The mid-point of the annual guidance indicates a 4.8% improvement from the 2023 reported figure. Net loss is estimated to be between $110.32 million and $103.02 million.

Interest expense is estimated at $40.6 million, indicating a 3.6% decline from the 2023 figure. Income tax expense is forecasted to be in the range of $1.99-$4.69 million.

Depreciation and amortization expenses are estimated to be $31.8 million. Transformational and restructuring-related expenses are expected at $48 million.

Zacks Rank & Other Key Picks

Pediatrix Medical currently sports a Zacks Rank #1 (Strong Buy).

Some other top-ranked and promising stocks in the broader Medical sector are Tenet Healthcare Corporation THC, CareDx, Inc CDNA and Encompass Health Corporation EHC. While Tenet Healthcare currently sports a Zacks Rank #1, CareDx and Encompass Health carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Tenet Healthcare’s 2024 bottom line suggests 63.2% year-over-year growth. THC has witnessed four upward estimate revisions over the past 30 days against no movement in the opposite direction. It beat earnings estimates in all the last four quarters, with an average surprise of 59.9%.

The Zacks Consensus Estimate for CareDx’s current-year earnings indicates a 143.8% year-over-year improvement. CDNA beat earnings estimates in each of the past four quarters, with an average surprise of 135.2%. The consensus mark for revenues suggests 16.8% growth from the year-ago period.

The Zacks Consensus Estimate for Encompass Health’s 2024 full-year earnings implies a 17.3% increase from the year-ago reported figure. EHC beat earnings estimates in each of the last four quarters, with an average surprise of 13.6%. The consensus mark for its current-year revenues is pegged at $5.34 billion, which indicates an 11.3% year-over-year increase.

Zacks Investment Research

Investors looking for stocks in the Medical Services sector might want to consider either Pediatrix Medical Group (MD) or Avantor, Inc. (AVTR). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Pediatrix Medical Group has a Zacks Rank of #1 (Strong Buy), while Avantor, Inc. has a Zacks Rank of #5 (Strong Sell) right now. This means that MD's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one piece of the puzzle for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

MD currently has a forward P/E ratio of 12.37, while AVTR has a forward P/E of 23.32. We also note that MD has a PEG ratio of 2.21. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. AVTR currently has a PEG ratio of 2.78.

Another notable valuation metric for MD is its P/B ratio of 1.89. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, AVTR has a P/B of 2.82.

These metrics, and several others, help MD earn a Value grade of A, while AVTR has been given a Value grade of D.

MD 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 MD is likely the superior value option right now.

Zacks Investment Research

Shares of HealthEquity (HQY) have been strong performers lately, with the stock up 16.8% over the past month. The stock hit a new 52-week high of $99 in the previous session. HealthEquity has gained 47.7% since the start of the year compared to the 3.2% move for the Zacks Medical sector and the -4.8% return for the Zacks Medical Services industry.

What's Driving the Outperformance?

The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on September 3, 2024, HealthEquity reported EPS of $0.86 versus consensus estimate of $0.7 while it beat the consensus revenue estimate by 5.43%.

For the current fiscal year, HealthEquity is expected to post earnings of $3.09 per share on $1.18 billion in revenues. This represents a 37.33% change in EPS on a 18.23% change in revenues. For the next fiscal year, the company is expected to earn $3.73 per share on $1.32 billion in revenues. This represents a year-over-year change of 20.81% and 11.78%, respectively.

Valuation Metrics

HealthEquity may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company has run ahead of itself.

On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.

HealthEquity has a Value Score of C. The stock's Growth and Momentum Scores are A and D, respectively, giving the company a VGM Score of B.

In terms of its value breakdown, the stock currently trades at 31.7X current fiscal year EPS estimates, which is a premium to the peer industry average of 18.5X. On a trailing cash flow basis, the stock currently trades at 28.7X versus its peer group's average of 11.8X. Additionally, the stock has a PEG ratio of 1.13. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.

Zacks Rank

We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, HealthEquity currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.

Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if HealthEquity fits the bill. Thus, it seems as though HealthEquity shares could still be poised for more gains ahead.

How Does HQY Stack Up to the Competition?

Shares of HQY have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Pediatrix Medical Group, Inc. (MD). MD has a Zacks Rank of # 1 (Strong Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of C.

Earnings were strong last quarter. Pediatrix Medical Group, Inc. beat our consensus estimate by 18.92%, and for the current fiscal year, MD is expected to post earnings of $1.43 per share on revenue of $2 billion.

Shares of Pediatrix Medical Group, Inc. have gained 35.8% over the past month, and currently trade at a forward P/E of 12.37X and a P/CF of 10.26X.

The Medical Services industry may rank in the bottom 55% of all the industries we have in our universe, but there still looks like there are some nice tailwinds for HQY and MD, even beyond their own solid fundamental situation.

Zacks Investment Research