Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 6 stocks made the list for top value stocks in the Medical Equipment, Supplies & Distribution industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Medical Equipment, Supplies & Distribution Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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6 Undervalued Medical Equipment, Supplies & Distribution Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 6 undervalued stocks in the Medical Equipment, Supplies & Distribution industry for Friday, February 23, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Medical Equipment, Supplies & Distribution industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Alpha Pro Tech, Ltd.’s Value Grade

Value Grade:

Alpha Pro Tech, Ltd. is a Canada-based company, which is engaged in developing, manufacturing and marketing a line of protective apparel garments, face masks and face shields and a line of construction weatherization building products for the housing market. Its products are sold both under the Alpha Pro Tech brand name as well as under private labels. Its products are classified into two business segments: The Building Supply segment, and The Disposable Protective Apparel segment. The Building Supply segment consists of construction weatherization products, such as house wrap and synthetic roof underlayment, as well as other woven materials. The Disposable Protective Apparel segment consists of a head-to-toe disposable protective garment (shoe covers, bouffant caps, coveralls, gowns, frocks and lab coats), face masks and face shields. It serves the markets such as pharmaceuticals, biopharmaceuticals, medical device manufacturing, lab animal research, construction supply and more.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Alpha Pro Tech, Ltd. has a Value Score of 80, which is considered to be undervalued.

When you look at Alpha Pro Tech, Ltd.’s price-to-sales ratio at 1.09 compared to the industry median at 3.25, this company has a lower price relative to revenue compared to its peers. This could make Alpha Pro Tech, Ltd.’s stock more attractive for value investors.

Alpha Pro Tech, Ltd.’s price-earnings ratio is 17.46 compared to the industry median at 40.74. This means it has a lower share price relative to earnings compared to its peers. This could make Alpha Pro Tech, Ltd. more attractive for value investors.

Now, let’s assess Alpha Pro Tech, Ltd.’s EV/EBITDA ratio, also known as enterprise multiple. At 6.9, when compared to the industry median of 14.8, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Alpha Pro Tech, Ltd.’s shareholder yield is higher than its industry median ratio of (1.90%). Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Alpha Pro Tech, Ltd.’s price-to-book ratio is lower than its industry median ratio of 2.54. This could make Alpha Pro Tech, Ltd. more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Alpha Pro Tech, Ltd.’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Alpha Pro Tech, Ltd.’s price-to-free-cash-flow ratio is lower than its industry median ratio of 36.26. This could make Alpha Pro Tech, Ltd. more attractive because the lower P/FCF ratio indicates that Alpha Pro Tech, Ltd. is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Bioventus Inc’s Value Grade

Value Grade:

Bioventus Inc. is a medical device company. The Company is focused on developing and commercializing clinically differentiated and minimally invasive treatments that engage and enhance the body's natural healing process. Its portfolio of products is grouped into three verticals: Pain Treatments, Surgical Solutions, and Restorative Therapies. Its Pain Treatments consist of non-surgical joint pain injection therapies as well as peripheral nerve stimulation (PNS) products to help the patient get back to their normal activities. Its Surgical Solutions consist of bone graft substitutes (BGS) to fuse and grow bones and ultrasonic medical devices used for precise bone sculpting, removal of tumors, and tissue debridement in various surgeries, including spine and neurosurgery. Its Restorative Therapies consist of an ultrasonic bone healing system for fracture care, and advanced rehabilitation devices designed to help patients regain leg or hand function due to stroke.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Bioventus Inc has a Value Score of 63, which is considered to be undervalued.

Bioventus Inc’s price-to-book ratio is higher than its peers. This could make Bioventus Inc less attractive for value investors when compared to the industry median at 2.54.

You can read more about Bioventus Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Cooper Companies Inc’s Value Grade

Value Grade:

The Cooper Companies, Inc. is a global medical device company. The Company operates through two business units: CooperVision and CooperSurgical. CooperVision is engaged in the contact lens industry. CooperVision’s products include MyDay daily disposable, MyDay daily disposable toric, MyDay Energys, MyDay multifocal, Biofinity & Biofinity XR, Biofinity Energys, Biofinity toric & Biofinity XR toric, Biofinity multifocal, Biofinity toric multifocal, clariti 1 day, clariti 1 day toric, clariti 1 day multifocal, MiSight 1 day, Avaira Vitality and Avaira Vitality toric. CooperSurgical is a fertility and women’s health company dedicated to assisting women, babies and families around the world. CooperSurgical provides a range of products and services with an emphasis on improving fertility solutions, empowering office-based care, and advancing hospital care within women’s health. CooperSurgical’s brands include Paragard, ER-Complete, Fetal Pillow, INSORB, PGT-Complete, RUMI II and others.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Cooper Companies Inc has a Value Score of 63, which is considered to be undervalued.

Cooper Companies Inc’s price-earnings ratio is 16.6 compared to the industry median at 40.7. This means that it has a lower price relative to its earnings compared to its peers. This makes Cooper Companies Inc more attractive for value investors.

Cooper Companies Inc’s price-to-book ratio is higher than its peers. This could make Cooper Companies Inc less attractive for value investors when compared to the industry median at 2.54.

You can read more about Cooper Companies Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

DIH Holding US Inc’s Value Grade

Value Grade:

DIH Holding US, Inc. is a global robotics and virtual reality (VR) technology provider in the rehabilitation and human performance industry. The Company offers an integrated solution for the entire continuum of care and multiple markets, including hospitals, clinics, research and home. Its rehabilitation hospitals and outpatient clinics offering solutions include ArmeoPower, ArmeoSpring, ArmeoSpring Pro, ArmeoSenso, Erigo, Lokomat, SafeGait 360 by Gorbel, RYSEN, Andago, C-Mill, and HocoNet. Its Research & Academia offering solutions include GRAIL, CAREN Extended, M-Gait, and D-Flow. The ArmeoSpring Pro is a cutting-edge medical device designed to bring upper limb rehabilitation to the next level. ArmeoPower guides the initial phases of arm and hand function recovery. ArmeoSpring supports the recovery of arm and hand functions. ArmeoSenso is a sensor-based solution for arm function recovery. HocoNet is a software platform connecting product portfolio across the entire continuum of care.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

DIH Holding US Inc has a Value Score of 98, which is considered to be undervalued.

DIH Holding US Inc’s price-earnings ratio is 13.6 compared to the industry median at 40.7. This means that it has a lower price relative to its earnings compared to its peers. This makes DIH Holding US Inc more attractive for value investors.

DIH Holding US Inc’s price-to-book ratio is higher than its peers. This could make DIH Holding US Inc less attractive for value investors when compared to the industry median at 2.54.

You can read more about DIH Holding US Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Neurometrix Inc’s Value Grade

Value Grade:

NeuroMetrix, Inc. is a commercial-stage neurotechnology company based in Woburn, Massachusetts. The Company is engaged in designing, building and marketing medical devices that stimulate nerves and analyze nerve response for diagnostic and therapeutic purposes. The Company has two principal product categories: Diagnostic technology and Therapeutic technology. Diagnostic technology product category is engaged in point-of-care peripheral neuropathy assessment. Therapeutic technology product category is engaged in wearable neuromodulation for chronic pain syndromes. The Company?s DPNCheck is its testing technology for peripheral neuropathies. The Company?s Quell is its wearable neuromodulation technology for chronic pain. It refined approximately 200,000 chronic pain patients. Patients control and personalize the technology via a mobile phone application, and their utilization and certain clinical metrics may be tracked in the Quell Health Cloud.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Neurometrix Inc has a Value Score of 72, which is considered to be undervalued.

Neurometrix Inc’s price-to-book ratio is higher than its peers. This could make Neurometrix Inc less attractive for value investors when compared to the industry median at 2.54.

You can read more about Neurometrix Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Patterson Companies, Inc.’s Value Grade

Value Grade:

Patterson Companies, Inc. is a value-added specialty distributor serving the United States and Canadian dental supply markets and the United States, Canadian and United Kingdom animal health supply markets. The Company’s segments include Dental, Animal Health and Corporate. Dental segment provides a virtually complete range of consumable dental products, equipment and software, turnkey digital solutions and value-added services to dentists, dental laboratories, institutions, and other healthcare professionals throughout North America. Animal Health segment is a full-line distributor in North America and the United Kingdom. of animal health products, services, and technologies to both the production-animal and companion-pet markets. The Company provides relief services. It also provides pasteurizing equipment and single-use bags that allow dairy producers to produce, store and feed colostrum for newborn calves, as well as product offerings for beef cattle producers.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Patterson Companies, Inc. has a Value Score of 71, which is considered to be undervalued.

Patterson Companies, Inc.’s price-earnings ratio is 13.7 compared to the industry median at 40.7. This means that it has a lower price relative to its earnings compared to its peers. This makes Patterson Companies, Inc. more attractive for value investors.

Patterson Companies, Inc.’s price-to-book ratio is lower than its peers. This could make Patterson Companies, Inc. fairly attractive for value investors when compared to the industry median at 2.54.

You can read more about Patterson Companies, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Medical Equipment, Supplies & Distribution Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Medical Equipment, Supplies & Distribution stocks as well as other industrys.

Choosing Which of the 6 Best Medical Equipment, Supplies & Distribution Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Alpha Pro Tech, Ltd. stock has a Value Grade of B.
• Bioventus Inc stock has a Value Grade of B.
• Cooper Companies Inc stock has a Value Grade of B.
• DIH Holding US Inc stock has a Value Grade of A.
• Neurometrix Inc stock has a Value Grade of B.
• Patterson Companies, Inc. stock has a Value Grade of B.

Now that you have a bit more background about each of the 6 undervalued stocks in the Medical Equipment, Supplies & Distribution industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Medical Equipment, Supplies & Distribution Stocks

Want to learn more about Medical Equipment, Supplies & Distribution stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 6 Undervalued Medical Equipment, Supplies & Distribution Stocks for Friday, February 23
• 4 Undervalued Medical Equipment, Supplies & Distribution Stocks for Thursday, February 22
• What You Need to Know About Insulet Corp's Q4 Earnings
• What You Need to Know About Novocure Ltd's Q4 Earnings

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