Should You Buy Cantel Medical Stock Today?

by Rob Otman

Cantel Medical (NYSE: CMD) is a $4 billion company today. Investors that bought shares one year ago are sitting on a 16.04% total return. That's below the S&P 500's return of 17.66%.

Cantel Medical stock is underperforming the market. It's beaten down, and it recently missed earnings expectations. So is it a good time to buy? To answer this question, we've turned to the Investment U Stock Grader. Our Research Team built this system to diagnose the financial health of a company.

Our system looks at six key metrics...

Earnings-per-Share (EPS) Growth: Cantel Medical reported a recent EPS growth rate of 16.22%. That's above the healthcare equipment and supplies industry average of 10.98%. That's a great sign. Cantel Medical's earnings growth is outpacing that of its competitors.

Price-to-Earnings (P/E): The average price-to-earnings ratio of the healthcare equipment and supplies industry is 54.61. And Cantel Medical's ratio comes in at 46.36. It's trading at a better value than many of its competitors.

Debt-to-Equity The debt-to-equity ratio for Cantel Medical stock is 30.84. That's below the healthcare equipment and supplies industry average of 48.88. The company is less leveraged.

Free Cash Flow per Share Growth Cantel Medical's FCF has been lower than that of its competitors over the last year. That's not good for investors. In general, if a company is growing its FCF, it will be able to pay down debt, buy back stock, pay out more in dividends and/or invest money back into the business to help boost growth. It's one of our most important fundamental factors.

Profit Margins The profit margin of Cantel Medical comes in at 9.78% today. And generally, the higher, the better. We also like to see this margin above that of its competitors. Cantel Medical's profit margin is above the healthcare equipment and supplies average of 7.77%. So that's a positive indicator for investors.

Return on Equity Return on equity tells us how much profit a company produces with the money shareholders invest. The ROE for Cantel Medical is 14.75%, and that's above its industry average ROE of 8.75%.

Cantel Medical stock passes five of our six key metrics today. That's why our Investment U Stock Grader rates it as a Strong Buy.


Please note that our fundamental factor checklist is just the first step in performing your own due diligence. There are many other factors you should consider before investing. That's why The Oxford Club offers more than a dozen newsletters and trading advisories all aimed at helping investors grow and maintain their wealth. For more details, click here.

IU Stock Grader