One method to increase the effectiveness of your search for value opportunities is to screen for stocks whose "Graham blended multiplier" yields less than 22.5. Designed by Benjamin Graham, the father of value investing, the multiplier is equal to the stock's price-earnings ratio multiplied by its price-book ratio.
Therefore, value investors may want to consider the following stocks, since their Graham blended multipliers stand below 22.5.
GEE Group Inc
The first stock investors may want to consider is GEE Group Inc (JOB, Financial), a Jacksonville, Florida-based staffing and employment services provider in the U.S.
The stock has a Graham blended multiplier of 1.38, as the price-earnings ratio is 1.66 (versus the industry median of 23.52) and the price-book ratio is 0.83 (versus the industry median of 2.28).
GEE Group Inc traded at $1.28 per share at close on April 6 for a market capitalization of $22.61 million.
The share price has grown 327% over the past year for a 52-week range of $0.17 to $2.49.
Currently, GEE Group Inc is not distributing dividends.
GuruFocus assigned a rating of 3 out of 10 to the company's financial strength and 2 out of 10 to its profitability.
On Wall Street, the stock has one recommendation rating of buy with a target price of $2.75 per share.
FutureFuel Corp
The second stock investors may want to consider is FutureFuel Corp (FF, Financial), a St. Louis, Missouri-based manufacturer and seller of various chemicals, including bio-based fuel and specialty chemical products.
The stock has a Graham blended multiplier of 21.81, as the price-earnings ratio is 13.14 (versus the industry median of 24.18) and the price-book ratio is 1.66 (versus the industry median of 1.95).
FutureFuel Corp traded at $14.20 per share at close on April 6 for a market capitalization of $621.15 million.
The share price has risen by 11.37% over the past year, determining a 52-week range of $9.17 to $17.86.
The company is currently paying quarterly dividends of 6 cents per common share to its shareholders for a trailing 12-month and forward dividend yield of 1.7% as of April 6.
GuruFocus assigned a rating of 9 out of 10 to the company's financial strength and of 7 out of 10 to its profitability.
On Wall Street, the stock has a recommendation rating of buy with a target price of $14 per share.
Capital Bancorp Inc
The third company investors may want to consider is Capital Bancorp Inc (CBNK, Financial), a Rockville, Maryland-based regional bank providing various banking products and services to several U.S. businesses, entrepreneurs and not-for-profit organizations.
The stock has a Graham blended multiplier of 17.87, as the price-earnings ratio is 10.51 (versus the industry median of 13.28) and the price-book ratio is 1.7 (versus the industry median of 0.99).
Capital Bancorp Inc traded at $19.66 per share at close on April 6 for a market capitalization of $270.5 million.
The share price has risen by 67.8% over the past year for a 52-week range of $9.02 to $20.96.
Currently, Capital Bancorp Inc does not pay dividends.
GuruFocus assigned a score of 3 out of 10 to the company's financial strength and of 2 out of 10 to its profitability.
On Wall Street, the stock has a median recommendation rating of buy and an average target price of $21.25 per share.
Disclosure: I have no positions in any securities mentioned.
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