Covidien PLC (COV): Today's Featured Health Services Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Covidien ( COV) pushed the Health Services industry higher today making it today's featured health services winner. The industry as a whole closed the day down 0.2%. By the end of trading, Covidien rose 63 cents (1%) to $63.62 on average volume. Throughout the day, 1.8 million shares of Covidien exchanged hands as compared to its average daily volume of 2.2 million shares. The stock ranged in a price between $62.83-$63.62 after having opened the day at $63.14 as compared to the previous trading day's close of $62.99. Other companies within the Health Services industry that increased today were: Bovie Medical Corporation ( BVX), up 11.8%, Mela ( MELA), up 6%, Allied Healthcare Products ( AHPI), up 5.7%, and NeoGenomics ( NEO), up 5.3%.
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Covidien plc develops, manufactures, and sells healthcare products for use in clinical and home settings worldwide. Covidien has a market cap of $29.87 billion and is part of the health care sector. The company has a P/E ratio of 16.1, below the S&P 500 P/E ratio of 17.7. Shares are up 9.6% year to date as of the close of trading on Thursday. Currently there are 15 analysts that rate Covidien a buy, one analyst rates it a sell, and two rate it a hold.

TheStreet Ratings rates Covidien as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, attractive valuation levels, growth in earnings per share and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

On the negative front, Five Star Quality Care Incorporated ( FVE), down 14.4%, Fonar Corporation ( FONR), down 10.1%, EnteroMedics ( ETRM), down 7.6%, and InfuSystems Holdings ( INFU), down 7.4%, were all laggards within the health services industry with DaVita HealthCare Partners ( DVA) being today's health services industry laggard.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the health services industry could consider Health Care Select Sector SPDR ( XLV) while those bearish on the health services industry could consider ProShares Ultra Short Health Care ( RXD).

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