Value stocks typically trade at discounts to the broader market, offering patient investors the opportunity to buy businesses when they’re out of favor. The key risk, however, is that these stocks are usually cheap for a reason – five cents for a piece of fruit may seem like a great deal until you find out it’s rotten.
This distinction between true value and value traps can challenge even the most skilled investors. Luckily for you, we started StockStory to help you uncover exceptional companies. That said, here are two value stocks offering compelling risk-reward profiles and one with little support.
One Value Stock to Sell:
Teladoc (TDOC)
Forward EV/EBITDA Ratio: 4.2x
Founded to help people in rural areas get online medical consultations, Teladoc Health (NYSE:TDOC) is a telemedicine platform that facilitates remote doctor’s visits.
Why Does TDOC Fall Short?
- 4.4% annual revenue growth over the last three years was slower than its consumer internet peers
- Focus on expanding its platform came at the expense of monetization as its average revenue per user fell by 7.1% annually
- Demand will likely fall over the next 12 months as Wall Street expects flat revenue
At $6.94 per share, Teladoc trades at 4.2x forward EV/EBITDA. To fully understand why you should be careful with TDOC, check out our full research report (it’s free).
Two Value Stocks to Watch:
Molina Healthcare (MOH)
Forward P/E Ratio: 6.6x
Founded in 1980 as a provider for underserved communities in Southern California, Molina Healthcare (NYSE:MOH) provides managed healthcare services primarily to low-income individuals through Medicaid, Medicare, and Marketplace insurance programs across 21 states.
Why Are We Positive On MOH?
- Market share has increased this cycle as its 19.7% annual revenue growth over the last five years was exceptional
- Sizeable revenue base of $43.41 billion gives it economies of scale and favorable reimbursement terms with healthcare providers
- Earnings growth has easily exceeded the peer group average over the last five years as its EPS has compounded at 11.1% annually
Molina Healthcare is trading at $155.48 per share, or 6.6x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
First Financial Bancorp (FFBC)
Forward P/B Ratio: 0.9x
Tracing its roots back to 1863 during the Civil War era, First Financial Bancorp (NASDAQ:FFBC) is a bank holding company that provides commercial banking, lending, deposit services, and wealth management to individuals and businesses.
Why Does FFBC Stand Out?
- Performance over the past five years was boosted by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Annual tangible book value per share growth of 17% over the last two years was superb and indicates its capital strength increased during this cycle
- Stellar return on equity showcases management’s ability to surface highly profitable business ventures
First Financial Bancorp’s stock price of $23.64 implies a valuation ratio of 0.9x forward P/B. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
Stocks We Like Even More
When Trump unveiled his aggressive tariff plan in April 2025 markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.