These 7 healthcare stocks are trading below their 5-year average P/E

The BSE healthcare sector fell about 12 per cent over the last one year while the benchmark index Sensex dropped about 6 per cent. ETMarkets analysed healthcare stocks whose current P/Es are trading with a discount to their 5-year average P/Es. To examine, we picked only stocks that posted a return of equity (RoE) above 10 per cent and made profits in each of the last five fiscal years. We considered only companies with a market cap of over Rs 2,500 crore. From the sector, seven stocks have made the cut. Take a look.

5-Year Average P/E: 30.97 TTM P/E: 25.10

Here are the key strong points of the stock according to Trendlyne.com SWOT analysis:

Efficient in managing assets to generate profits - ROA improving since last 2 year
Growth in net profit with increasing profit margin (QoQ)
Company with no debt
Annual net profits improving for last 2 years
Book value per share Improving for last 2 years
FII/FPI or Institutions increasing their shareholding

5-Year Average P/E: 52.93 TTM P/E: 46.97

This stock has more weaknesses than strengths. Here are the key weak points of the stock according to Trendlyne.com SWOT analysis:

Declining profits every quarter for the past 4 quarters
Declining net cash flow: Companies not able to generate net cash
Major fall in TTM net profit
Fall in quarterly revenue and net profit (YoY)
Highest fall from 52-week high
High promoter stock pledges

5-Year Average P/E: 40.61 TTM P/E: 30.54

Here are the key strong points of the stock according to Trendlyne.com SWOT analysis.

Efficient in managing assets to generate profits - ROA improving since last 2 year
Growth in quarterly net profit with increasing profit margin (YoY)
Company with no debt
Annual net profits improving for last 2 years
Book value per share improving for last 2 years
Company with zero promoter pledge

5-Year Average P/E: 51.68 TTM P/E: 44.29

This stock has more weaknesses than strengths. Here are the key weak points of the stock according to Trendlyne.com SWOT analysis.

Inefficient use of capital to generate profits - RoCE declining in the last 2 years
MFs decreased their shareholding last quarter
Decline in net profit with falling profit margin (QoQ)
Declining net cash flow: Companies not able to generate net cash
Annual net profit declining for last 2 years
Weak momentum: Price below short, medium and long term averages

5-Year Average P/E: 19.77 TTM P/E: 9.42

Here are the key strong points of the stock according to Trendlyne.com SWOT analysis.

Increasing revenue every quarter for the past 2 quarters
Annual net profits improving for last 2 years
Book value per share improving for last 2 years
Company with zero promoter pledge
FII/FPI or institutions increasing their shareholding
Strong momentum: Price above short, medium and long term moving averages

5-Year Average P/E: 24.37 TTM P/E: 22.91

Here are the key strong points of the stock according to Trendlyne.com SWOT analysis.

Company with low debt
Increasing revenue every quarter for the past 2 quarters
Annual net profits improving for last 2 years
Book value per share Improving for last 2 years
Company with decreasing promoter pledge
FII/FPI or Institutions increasing their shareholding

5-Year Average P/E: 29.61 TTM P/E: 24.01

Here are the key strong points of the stock according to Trendlyne.com SWOT analysis.

Growth in net profit with increasing profit margin (QoQ)
Growth in quarterly net profit with increasing profit margin (YoY)
Company with low debt
Book value per share improving for last 2 years
Company with zero promoter pledge
FII/FPI or Institutions increasing their shareholding