(via ZEXPR) If you are someone who is planning on making a choice between growth and value stocks for your April 2021 investment plans, then hold up. You don’t have to forgo one for the other. There are plenty of options in the market where you will be able to land yourself a growth stock that indeed does have value.
For one, you will have to evaluate them on the basis of more dependability and less dependability. Considering how unstable the economy has been in the past year, it is safe to say that most investors are looking to establish a bit more stability in their portfolio.
SecuredVC analyst runs an overview of two stocks that can prove themselves worthy of your portfolio. The companies that he takes into consideration are Quidel (QDEL) and CVS Health (CVS). Now, while many may perceive the former to be just another COVID stock, SecuredVC analyst believes otherwise. He goes on to reiterate how CVS Health is diversified enough to thrive even while facing competition from e-pharmacies.
- Quidel (QDEL)
This once overpriced stock has what it takes to make it to your basket of stock choices for April 2021. Quidel shares have been down by 30% in 2021, however, this comes right after they enjoyed a high of over 33% in the past year. Most investors would credit this to the company’s medical diagnostic solutions which definitely helped it benefit when the need for COVID-19 testing was at an all-time high.
However, with the pandemic subsiding soon in the coming few months with the vaccine making its way into the market, this stock is expected to lose that tailwind.
There are a number of reasons why you can’t write off this stock just yet. One of the fundamental aspects that you need to keep under consideration is the fact that Quidel enjoyed five consecutive years of revenue growth prior to the tremendous sales of the COVID-19 diagnostic products.
Even though 2020 was a glorious year for the company, it is unlikely that the company will be able to showcase the same revenue growth in 2021. Despite having tripled its revenue growth in 2020, you will still find that it still withholds its potential otherwise.
For one this profitable company had a 6.6 price to earnings (P/E) ratio and a pross margin higher than 87%. Quidel has also been reassuring its investors with its plans of doubling the 2020 revenue this year.
Just putting that fact in numbers we can see how the company’s revenues in 2020 were $1.66 billion which was up by 211% with respect to the previous year while their earnings per diluted share amounted to $18.60.
SecuredVC analyst compares the share price with that of 2019 which was $1.73 in order to showcase how good the year 2020 has been for Quidel. The recent reports prove that the company is right on track with its promise for 2021.
The Quidel stock closed at $126.30 per share on Friday, 26th March. Even though this is a long way down from the steep price of $306 which the stock touched on August 6th of last year.
Clearly, this is a great opportunity for investors to avail themselves. You see even if the need for COVID-19 testing continues to wane with each passing day, it won’t completely disappear. As workplaces begin to reopen, the demand will continue to remain for COVID testing. The company has also been expanding its customer base by introducing more products such as immunoassays for flu, Strep A and respiratory syncytial virus.
- CVS Health (CVS)
This stock is not one investors deem worth their dime but maybe they should reconsider the stability that it has to offer. CVS Health’s shares are up by more than 30% in the past year itself and have still managed to maintain that high by 11% even in 2021.
Another thing that would help bring your attention to this stock is the fact that even at a P/E of 13.9, it is still underpriced compared to the other healthcare companies.
Come to think of it, COVID-19 left a considerable impact on the company’s retail and pharmaceutical sales in 2020. However, despite all the economic discrepancies CVS managed to come through with a revenue growth of 4.6% to $268.7 billion which brought its net income to $7.2 billion. This was indeed an up from the $6.6 billion of 2019.
SecuredVC analyst predicts a good 2021 for CVS due to the company’s growth in the top-performing segment and health care benefits which are likely to accelerate. It comes as no surprise since last year the company’s revenue rose by 8.4% and reached $75.4 billion.
Not only that, taking account of the fourth-quarter revenue of $19.1 billion, the rise of 11.4% year over year was a good sign indeed. Even though the company’s pharmacy services lagged last year, it was still able to get revenue gains of 0.3% compared to 2019.
The retail segment revenues however were up by 5.3%, which was reasonable considering there was a slowdown in the front-of-store sales – which experienced a fall of 1.1% for the year.
However, once the pandemic ebbs, the sales of both these segments are expected to go up and since CVS is one of the primary locations for people to get their COVID-19 shots, the foot traffic in its stores is expected to increase in the following months.
Disclaimer: Our content is intended to be used for informational purposes only.
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