Value investors may be interested in the stocks listed below, as they have low price-sales ratios, good profitability and solid financial conditions. These three characteristics result in a high probability that these stocks could be value opportunities, in my opinion.
Molina Healthcare Inc
The first stock investors may be interested in is Molina Healthcare Inc (MOH, Financial), a Long Beach, California-based healthcare plans company.
The stock price traded at $200.18 per share at close on Dec. 11 for a price-sales ratio of 0.66, which is more compelling than the S&P 500's price-sales ratio of 2.67.
Molina Healthcare has a GuruFocus profitability rating of 6 out of 10, driven by a return on capital (ROC) ratio of 314.98% (versus the industry median of 61.04%) and a three-year earnings per share (EPS) without non-recurring items (NRI) growth rate of 131.9% (versus the industry median of 24.55%).
The company has received a GuruFocus financial strength rating of 7 out of 10. The rating is driven by a high Altman Z-Score of 4.97.
Following a 49.15% increase over the past year, the stock has a market capitalization of $11.87 billion and a 52-week range of $102.85 to $224.
As of December, Wall Street sell-side analysts recommend two strong buys, two buys, eight holds and one underperform rating. They have established an average target price of $231.08 per share.
BorgWarner Inc
The second stock investors could be interested in is BorgWarner Inc (BWA, Financial), an Auburn Hills, Michigan-based provider of several technical solutions for electric, hybrid and petrol vehicles worldwide.
The stock price traded at $36.52 per share at close on Dec. 11 for a price-sales ratio of 0.86, which is more compelling than the S&P 500's price-sales ratio of 2.67.
BorgWarner has a GuruFocus profitability rating of 8 out of 10, which is driven by an operating margin of 9.97% (versus the industry median of 2.82%) and a return on capital (ROC) ratio of 23.99% (versus the industry median of 5.46%).
The company has received a GuruFocus financial strength rating of 6 out of 10. It is driven by an Altman Z-Score of 3.07.
Following a 17.26% decrease over the past year, the stock now has a market capitalization of $8.93 billion and a 52-week range of $17 to $45.35.
As of December, Wall Street sell-side analysts recommend two strong buys, six buys, 10 holds and three underperform ratings for this stock and have established an average target price of $45.11 per share.
Steel Dynamics Inc
The third stock to consider is Steel Dynamics Inc (STLD, Financial), a Fort Wayne, Indiana-based steel producer and metal recycler with operations in the U.S.
The stock price traded at $39.13 per share at close on Dec. 11 for a price-sales ratio of 0.89, which appeals more than the S&P 500 price-sales ratio of 2.67.
Steel Dynamics has a GuruFocus profitability rating of 7 out of 10. It is driven by a return on capital (ROC) ratio of 14.75% (versus the industry median of 4.43%).
The company has a positive GuruFocus financial strength rating of 6 out of 10, driven by an Altman Z-Score of 3.57.
As a result of a 15.19% increase that took place over the past year, the stock has a market capitalization of $8.23 billion, while the 52-week range is $14.98 to $40.22.
As of December, Wall Street sell-side analysts recommend three strong buys, six buys and four hold ratings for this stock and have established an average target price of $37.91 per share.
Disclosure: I have no positions in any securities mentioned in this article.
Read more here:
- 3 Stocks Growing Capex Fast
- 3 Fast-Growing Small Caps to Consider
- A Trio of Non-Cyclical Stocks for the Value Investor
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