5 Undervalued Stocks With 5-Star Predictability

Canadian Pacific Railway tops the list

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Jul 27, 2020
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According to the GuruFocus All-in-One Screener, a Premium feature, the following companies have high business predictability ratings and wide margins of safety as of July 28.

Canadian Pacific Railway

Canadian Pacific Railway Ltd. (CP, Financial) has a business predictability rank of five out of five stars and, according to the discounted cash flow calculator, a 22.83% margin of safety at an average price of $276 per share.

The railroad company has a market cap of $37.5 billion and an enterprise value of $44.4 billion. Over the past five years, its revenue and earnings per share have increased 3.3% and 17.1%.

Over the past 12 months, the stock has gained 15.82% and is currently trading with a price-earnings ratio of 21.95. The share price has been as high as $280.53 and as low as $173.26 in the last year. As of July 28, the stock was trading 1.3% below its 52-week high and 59.8% above its 52-week low.

With 1.68% of outstanding shares, Steve Mandel (Trades, Portfolio)’s Lone Pine Capital is the company's largest guru shareholder, followed by Pioneer Investments (Trades, Portfolio) with 0.07%.

UnitedHealth

UnitedHealth Group Inc. (UNH, Financial) has a five-star business predictability rank and, according to the DCF calculator, a 15.73% margin of safety at the average price of $298 per share.

The health insurance provider has a market cap of $283 billion and an enterprise value of $303 billion. Over the past five years, its revenue and earnings per share have grown 12.9% and 22.6%.

The stock has gained 21.56% over the last 12 months and shares are trading with a price-earnings ratio of 16.79. The share price has been as high as $315.84 and as low as $187.12 in the last 52 weeks. As of July 28, the stock was trading 5.46% below its 52-week high and 59.07% above its 52-week low.

With 0.96% of outstanding shares, the Vanguard Health Care Fund (Trades, Portfolio) is the company's largest guru shareholder, followed by Dodge & Cox with 0.89% and Lone Pine Capital with 0.49%.

Group 1 Automotive

Group 1 Automotive Inc. (GPI, Financial) has a five-star business predictability rank and, according to the DCF calculator, a 60.59% margin of safety at an average price of $88 per share.

The automobile dealer has a $1.6 billion market cap and an enterprise value of $4.9 billion. Over the past five years, its revenue has increased 3.6% and its earnings per share have risen 23.1%.

The share price has lost 2.18% over the past 12 months. The stock is trading with a price-earnings ratio of 10. The share price has been as high as $110.11 and as low as $26.26 in the last 52 weeks. As of July 28, the stock was trading 20.04% below its 52-week high and 235% above its 52-week low.

With 1.86% of outstanding shares, Jeremy Grantham (Trades, Portfolio) is the company's most notable guru shareholder, followed by Hotchkis & Wiley with 1.10% and John Hussman (Trades, Portfolio) with 0.20%.

NVR

NVR Inc. (NVR, Financial) has a five-star business predictability rank and, according to the DCF calculator, a 33.93% margin of safety at an average price of $3,912 per share.

The homebuilder has a market cap of $14.4 billion and an enterprise value of $14 billion. Over the past five years, its revenue has grown 10.9% and its earnings per share have increased 28.4%.

Shares have climbed 12.66% compared to 12 months ago. The stock is currently trading with a price-earnings ratio of 18.89. The share price has been as high as $4,071.13 and as low as $2,043.01 in the last 52 weeks. As of July 28, the stock was trading 3.91% below its 52-week high and 91.48% above its 52-week low.

With 2.63% of outstanding shares, Diamond Hill Capital (Trades, Portfolio) is the company's largest guru shareholder, followed by Simons’ firm with 0.65% and the Smead Value Fund (Trades, Portfolio) with 0.54%.

Service Corp

Service Corp. International (SCI, Financial) has a five-star business predictability rank and, according to the DCF calculator, a 27.32% margin of safety at an average price of $38.41 per share.

The provider of funeral and cemetery services has a market cap of $6.8 billion and an enterprise value of $10.2 billion. Over the past five years, its revenue has grown 1.7% and its earnings per share have increased 25.5%.

Shares have declined 17.36% compared to 12 months ago. The stock is currently trading with a price-earnings ratio of 19.1. The share price has been as high as $52.89 and as low as $33.93 in the last 52 weeks. As of July 28, the stock was trading 27.38% below its 52-week high and 13.20% above its 52-week low.

With 0.24% of outstanding shares, Pioneer Investments is the company's largest guru shareholder, followed by Simons’ firm with 0.05%.

Disclosure: I do not own any stocks mentioned.

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