Seeking Alpha
Value, growth, long-term horizon, medium-term horizon
Profile| Send Message|
( followers)  

If you're interested in potentially undervalued stocks but don't know where to start, here are some ideas you may find interesting.

One proxy for fair value is analyst target price. Stocks trading at steep discounts to their target prices may be undervalued.

We ran a screen on the healthcare sector for stocks trading at the steepest discounts to their analyst target prices. Because target prices tend to be inflated due to analyst bullishness, we used the most pessimistic (lowest) target prices given by analysts.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think these stocks will soon meet their analyst target prices? Use this list as a starting point for your own analysis.

List sorted by potential upside implied by target price.

1. China Kanghui Holdings (NYSE:KH): Develops, manufactures, and markets orthopedic implants and associated instruments. Market cap of $350.25M. Of the 6 analysts that have set a target price on the stock, the lowest price target stands at $19.92. This implies a current upside of 32.80% from current levels around $15.00. The stock is a short squeeze candidate, with a short float at 11.19% (equivalent to 30.66 days of average volume). The stock has lost 18.83% over the last year.

2. Nxstage Medical, Inc. (NASDAQ:NXTM): Engages in the development, manufacture, and marketing of products for the treatment of kidney failure, fluid overload, and related blood treatments and procedures in the United States. Market cap of $974.28M. Of the 7 analysts that have set a target price on the stock, the lowest price target stands at $23.00. This implies a current upside of 30.31% from current levels around $17.65. The stock is a short squeeze candidate, with a short float at 11.9% (equivalent to 13.33 days of average volume). The stock has lost 29.2% over the last year.

3. MAP Pharmaceuticals, Inc. (NASDAQ:MAPP): Focuses on the development and commercialization of inhalation therapies for patients suffering from migraine. Market cap of $431.57M. Of the 8 analysts that have set a target price on the stock, the lowest price target stands at $18.00. This implies a current upside of 27.21% from current levels around $14.15. This is a risky stock that is significantly more volatile than the overall market (beta = 2.78). The stock is a short squeeze candidate, with a short float at 5.2% (equivalent to 14.73 days of average volume). The stock has had a couple of great days, gaining 7.44% over the last week.

4. Optimer Pharmaceuticals, Inc. (NASDAQ:OPTR): Focuses on discovering, developing, and commercializing hospital specialty products worldwide. Market cap of $557.0M. Of the 10 analysts that have set a target price on the stock, the lowest price target stands at $15.00. This implies a current upside of 25.63% from current levels around $11.94. The stock is a short squeeze candidate, with a short float at 19.24% (equivalent to 9.61 days of average volume). The stock has gained 4.37% over the last year.

5. Integra LifeSciences Holdings Corporation (NASDAQ:IART): Develops, manufactures, and markets surgical implants and medical instruments for neurosurgery, extremity reconstruction, orthopedics, and general surgery. Market cap of $641.0M. Of the 10 analysts that have set a target price on the stock, the lowest price target stands at $30.00. This implies a current upside of 25.52% from current levels around $23.90. The stock is currently stuck in a downtrend, trading 23.9% below its SMA20, 24.98% below its SMA50, and 43.3% below its SMA200. It's been a rough couple of days for the stock, losing 22.48% over the last week.

6. Merit Medical Systems, Inc. (NASDAQ:MMSI): Designs, develops, manufactures, and markets single-use medical products for interventional and diagnostic procedures worldwide. Market cap of $536.16M. Of the 6 analysts that have set a target price on the stock, the lowest price target stands at $16.00. This implies a current upside of 25.10% from current levels around $12.79. The stock is currently stuck in a downtrend, trading 7.07% below its SMA20, 6.28% below its SMA50, and 18.88% below its SMA200. The stock has gained 3.98% over the last year.

7. Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY): Focuses on the discovery, development, and commercialization of novel therapeutics based on RNA interference (Pending:RNAI). Market cap of $378.16M. Of the 9 analysts that have set a target price on the stock, the lowest price target stands at $11.00. This implies a current upside of 24.29% from current levels around $8.85. The stock is a short squeeze candidate, with a short float at 9.72% (equivalent to 11.78 days of average volume). The stock has had a couple of great days, gaining 8.59% over the last week.

8. Isis Pharmaceuticals, Inc. (NASDAQ:ISIS): Engages in the discovery and development of antisense drugs using antisense drug discovery platform. Market cap of $725.04M. Of the 6 analysts that have set a target price on the stock, the lowest price target stands at $9.00. This implies a current upside of 23.80% from current levels around $7.27. The stock is a short squeeze candidate, with a short float at 10.49% (equivalent to 15.32 days of average volume). The stock has lost 28.93% over the last year.

9. NuVasive, Inc. (NASDAQ:NUVA): Engages in the design, development, and marketing of minimally disruptive surgical products and procedures for the spine. Market cap of $479.85M. Of the 18 analysts that have set a target price on the stock, the lowest price target stands at $14.00. This implies a current upside of 23.24% from current levels around $11.36. It's been a rough couple of days for the stock, losing 9.77% over the last week.

10. Hanger Orthopedic Group Inc. (NYSE:HGR): Engages in the ownership and operation of orthotic and prosthetic (O&P) patient-care centers in the United States. Market cap of $610.26M. Of the 5 analysts that have set a target price on the stock, the lowest price target stands at $22.00. This implies a current upside of 21.35% from current levels around $18.13. The stock has had a good month, gaining 11.84%.

11. Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR): Engages in the development and commercialization of novel therapeutics to treat severe lipid disorders. Market cap of $328.29M. Of the 7 analysts that have set a target price on the stock, the lowest price target stands at $19.00. This implies a current upside of 21.02% from current levels around $15.70. It's been a rough couple of days for the stock, losing 6.21% over the last week.

12. Nordion Inc. (NYSE:NDZ): Provides various products and services used for the prevention, diagnosis, and treatment of diseases worldwide. Market cap of $547.07M. Of the 5 analysts that have set a target price on the stock, the lowest price target stands at $10.50. This implies a current upside of 19.73% from current levels around $8.77. Offers a good dividend, and appears to have good liquidity to back it up--dividend yield at 4.56%, current ratio at 2.27, and quick ratio at 1.93. The stock has lost 12.48% over the last year.

13. Orthofix International N.V. (NASDAQ:OFIX): Designs, develops, manufactures, markets, and distributes medical equipment used principally by musculoskeletal medical specialists for orthopedic applications. Market cap of $631.09M. Of the 5 analysts that have set a target price on the stock, the lowest price target stands at $41.00. This implies a current upside of 19.60% from current levels around $34.28. The stock has gained 14.8% over the last year.

14. Mine Safety Appliances Co. (NYSE:MSA): Develops, manufactures, and supplies health and safety products used by workers in the fire service, homeland security, construction, and other industries, as well as the military. Market cap of $1.23B. Of the 5 analysts that have set a target price on the stock, the lowest price target stands at $40.00. This implies a current upside of 19.47% from current levels around $33.48. Offers a good dividend, and appears to have good liquidity to back it up--dividend yield at 3.11%, current ratio at 2.71, and quick ratio at 1.83. The stock has gained 13.15% over the last year.

15. IPC The Hospitalist Company, Inc. (NASDAQ:IPCM): Provides hospitalist services in the United States. Market cap of $503.23M. Of the 9 analysts that have set a target price on the stock, the lowest price target stands at $36.00. This implies a current upside of 17.61% from current levels around $30.61. The stock is a short squeeze candidate, with a short float at 16.78% (equivalent to 13.69 days of average volume). The stock is currently stuck in a downtrend, trading 31.77% below its SMA20, 31.12% below its SMA50, and 31.1% below its SMA200. It's been a rough couple of days for the stock, losing 33.05% over the last week.

16. Brookdale Senior Living Inc. (NYSE:BKD): Operates senior living communities in the United States. Market cap of $1.88B. Of the 6 analysts that have set a target price on the stock, the lowest price target stands at $18.00. This implies a current upside of 15.46% from current levels around $15.59. This is a risky stock that is significantly more volatile than the overall market (beta = 3.05). It's been a rough couple of days for the stock, losing 10.35% over the last week.

*Target price data sourced from Thomson/First Call (via Yahoo! Finance), all other data sourced from Finviz.

Source: 16 Healthcare Stocks Deeply Discounted From Target Price