4-Star Stocks Poised to Pop: Metropolitan Health
Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, health-care provider Metropolitan Health Networks (ASE: MDF) has earned a respected four-star ranking.
With that in mind, let's take a closer look at Metropolitan Health's business and see what CAPS investors are saying about the stock right now.
Metropolitan Health facts
West Palm Beach, Fla. (1996)
Managed health care
Chairman/CEO Michael Earley
CFO Robert Sabo
Return on Equity (Average, Past 3 Years)
$49.5 million / $919,000
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
Just last month, JTMcGee nicely summed up the Metropolitan Health bull case:
Low interest rates mean lower utilization from seniors on both fronts and higher earnings for as far as the eye can see. Good management focused on growth, shareholder value. This is a takeover candidate at current valuation, no doubt about it.
In fact, Metropolitan Health sports a particularly paltry forward P/E of 6.8. That represents a discount to industry peers like Humana (NYS: HUM) (9.8), UnitedHealth (NYS: UNH) (9.9), and WellPoint (NYS: WLP) (8.3).
CAPS member bosstocks applauds Metropolitan Health's recently approved purchase of rival Continucare:
MDF is valued very cheaply at these levels even assuming stagnant growth in the future. ... Therefore I believe the margin of safety is quite large at this point. ...
Just take a gander at the financials for CNU and do the math. This is a no brainer investment with serious upside. Management on the call ... sounded very optimistic over the merger, was very impressed with the quality of CNU's staff, and emphasized ambitious future growth plans. The financing ... will leverage the new company substantially. Considering the cash flows, these obligations should be met with ease, and returns to equity will increase dramatically. ...
All in all things are looking good in the Sun Shine State.
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