The following companies may be undervalued as of March 9, 2020, since their stocks have a price-earnings ratio below 20 and a price-earnings to growth (PEG) ratio below 1.
Furthermore, sell-side analysts on Wall Street have also issued positive recommendation ratings for these securities.
Callaway Golf
The first company that meets these criteria is Callaway Golf Co (ELY, Financial).
Shares of the Carlsbad, California-based designer, manufacturer and seller of golf clubs, balls, apparel and other products traded at a price of $14.21 per unit at close on Monday for a market capitalization of $1.34 billion.
The price-earnings ratio is 17.54 versus the industry median of 16.19 and the PEG ratio is 0.66 versus the industry median of 1.37.
The stock price has declined 33% so far this year and now trades below the 40-day simple moving average line.
Callaway Golf Co has received a moderate GuruFocus rating of 5 out of 10 for its financial strength and a rating of 6 out of 10 for its profitability.
Wall Street sell-side analysts recommend a buy rating for this stock and have set an average target price of $24.45 per share.
NVR Inc
The second company that meets the above-listed criteria is NVR Inc (NVR, Financial).
Shares of the Reston, Virginia-based U.S. homebuilder traded at a price of $3,632.35 per unit on Monday for a market capitalization of $13.36 billion.
The price-earnings ratio is 16.42 versus the industry median of 10.22 and the PEG ratio is 0.87 versus the industry median of 0.53.
The share price has declined 5% so far this year to trade significantly below the 40-day simple moving average line.
GuruFocus assigned the company a high financial strength rating of 8 out of 10 and the highest profitability rating of 10 out of 10.
Wall Street sell-side analysts issued a hold recommendation rating for this stock with an average target price of $4,363 per share.
Sleep Number
The third company that meets the above-listed criteria is Sleep Number Corp (SNBR, Financial).
Shares of the Minneapolis, Minnesota-based provider of sleep solutions and services in the U.S. traded at a price of $38.73 at close on Monday for a market capitalization of $1.07 billion.
The price-earnings ratio is 14.34, which is below the industry median of 21.56, and the PEG ratio is 0.77 versus the industry median of 1.19.
The stock price has declined 21% so far this year to trade significantly below the 40-day simple moving average line.
GuruFocus has assigned a low rating of 3 out of 10 for the company’s financial strength and a high rating of 9 out of 10 for its profitability.
Wall Street sell-side analysts recommend a hold rating for this stock and have established an average target price of $52 per share.
Disclosure: I have no positions in any securities mentioned.
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