Value investors may want to consider the following four stocks, since their share prices are trading below their respective Peter Lynch earnings lines. This indicates they could be undervalued.
Wall Street sell-side analysts have also issued positive ratings for these stocks.
Liberty Global PLC
The first stock investors may want to consider is Liberty Global PLC (LBTYA, Financial), a London, UK-based provider of broadband internet and various telecommunications services to residential customers and businesses in the UK and internationally.
The chart below illustrates that the share price ($27.41 at close on Aug. 20) is currently trading below the intrinisic value estimate of $277.05 calculated by the Peter Lynch earnings line.
The stock has climbed 23% over the past year through Friday for a market capitalization of $15.32 billion and a 52-week range of $18.73 to $29.43.
The stock has a median recommendation rating of overweight on Wall Street and an average target price of $39.11. This reflects a nearly 43% upside compared to Friday’s closing price. Analysts project earnings per share will increase by 165.2% this year.
GuruFocus has assigned a score of 4 out of 10 to the company's financial strength and 5 out of 10 to its profitability.
Harris Associates LP is the leader among top fund holders of the company with 9.21% of shares outstanding. The investment firm is followed by David Herro (Trades, Portfolio) with 3.31% and Dodge & Cox with 1.42%.
Mohawk Industries Inc
The second stock investors may want to consider is Mohawk Industries Inc (MHK, Financial), a Calhoun, Georgia-based designer, manufacturer and seller of flooring products for remodeling old constructions and furnishing new constructions, both as residential and commercial spaces.
The chart below shows that the share price ($200.78 as of Aug. 20) is currently trading below the Peter Lynch earnings line's intrinsic value estimate of $218.10.
The stock has increased by nearly 115% over the past year through Friday, determining a market capitalization of $13.86 billion and a 52-week range of $89.64 to $231.8.
Wall Street sell-side analysts have recommended a median rating of overweight for this stock with an average target price of $230.62, which mirrors a nearly 15% upside from Friday’s closing price. Furthermore, analysts forecast that the earnings per share will increase by approximately 4% every year over the next five years.
GuruFocus has assigned a score of 6 out of 10 to the company's financial strength and 7 out of 10 to its profitability.
FMR LLC is the largest top fund holder of the company, holding 9.48% of total shares outstanding. Vanguard Group Inc and BlackRock Inc. follow with 8.77% and 6.96%, respectively.
Amerco Inc
The third stock investors may want to consider is Amerco Inc (UHAL, Financial), a Reno, Nevada-based do-it-yourself moving and storage operator for household and commercial goods in North America.
The chart below shows that currently, the share price ($644.30 at close on Aug. 20) is still trading below the Peter Lynch earnings line's intrinsic value estimate of $664.05.
The stock has increased by 81.44% over the past year through Friday for a market capitalization of $12.63 billion and a 52-week range of $345.19 to $666.06.
The stock has one recommendation rating of overweight on Wall Street with a target price of $740 per share, which reflects a nearly 15% upside from Friday’s closing price. On Wall Street, the earnings per share is projected to increase by 15% on average per annum over the next five years.
GuruFocus has assigned a score of 4 out of 10 to the financial strength and of 8 out of 10 to the profitability of the company.
Vanguard Group is the largest top fund holder with 4.05% of shares outstanding. It is followed by BlackRock Inc. with 3.77% and David Abrams (Trades, Portfolio) with 2.86%.
UGI Corp
The fourth stock investors may want to consider is UGI Corp (UGI, Financial), a King of Prussia, Pennsylvania-based distributor of energy products in the U.S. and internationally.
The chart below shows that the share price ($46.63 as of Aug. 20) is currently trading well below the Peter Lynch earnings line of $67.95.
The stock has grown by 36% over the past year through Friday, determining a market capitalization of $9.75 billion and a 52-week range of $31.09 to $48.55.
Wall Street sell-side analysts have recommended a median rating of overweight for this stock with an average target price of $53.25, which mirrors a 14.2% upside from Friday’s closing price. Furthermore, analysts forecast that the earnings per share will increase by approximately 7.75% every year over the next five years.
GuruFocus has assigned a score of 4 out of 10 to the company's financial strength and 7 out of 10 to its profitability.
BlackRock Inc. is the largest top fund holder of the company, owning 11.21% of total shares outstanding. Vanguard Group and WELLINGTON MANAGEMENT GROUP LLP are following with 10.27% and 7.13%, respectively.
Disclosure: I have no positions in any securities mentioned.
