When in search of bargain opportunities as a value investor, you may want to consider the following stocks, as their share prices are trading near or below the intrinsic value estimated by the GuruFocus Value Line.
The GF Value is a unique intrinsic value calculation from GuruFocus that utilizes the following three components:
- The stock's historical multiples, such as the price-earnings ratio, the price-sales ratio, the price-book ratio and the price-to-free cash flow ratio.
- A GuruFocus adjustment factor based on the past returns and growth of the company's business.
- Estimations of future business performance.
Cia Paranaense De Energia Copel
The first stock that meets the criteria is Cia Paranaense De Energia Copel (ELP, Financial), a Curitiba, Brazil-based distributor of electricity in the Brazilian state of Paraná.
Cia Paranaense De Energia Copel's share price was $1.13 at close on Friday while its GF Value stands at $1.60, resulting in a price-to-GF Value ratio of 0.71 and a rating of modestly undervalued.
The stock gained 5% over the past year, determining a market capitalization of $30.92 billion and a 52-week range of $0.89 to $1.47.
The price-earnings ratio is 4.47 (versus the industry median of 16.98) and the price-book ratio is 0.87 (versus the industry median of 1.51). Also, the price-sales ratio is 0.92 (versus the industry median of 1.5) and the price-to-free cash flow ratio is 4.59 (versus the industry median of 14.86).
The stock has a GuruFocus profitability rating of 7 out of 10.
Concerning the future business performance, sell-side analysts on Wall Street estimate that earnings per share will grow by an average annual growth rate of 6.20% over the next five years. As of April, the stock has one buy recommendation rating and one hold recommendation rating for an average target price of $1.46 per share.
Banco Macro SA
The second stock that matches the requirements is Banco Macro SA (BMA, Financial), a Buenos Aires, Argentina-based regional provider of various banking products and services to consumers and businesses in Argentina.
Banco Macro's shares closed at $13 on Friday compared to its GF Value of $14.51, resulting in a price-to-GF Value ratio of 0.90 and a rating of modestly undervalued.
The stock lost 22% over the past year for a market capitalization of $830.70 million and a 52-week range is $11.45 to $26.79.
The price-earnings ratio is 4.49 (versus the industry median of 13.33) and the price-book ratio is 0.85 (versus the industry median of 0.99). The price-sales ratio is 1.36 (compared to the industry median of 2.74) and the price-to-free cash flow ratio is 9.93 (versus the industry median of 6.9).
The GuruFocus profitability rating is 6 out of 10.
With regard to future business performance, sell-side analysts on Wall Street forecast that the earnings per share will move up at an average pace of 24.74% every year over the next five years. As of April, sell-side analysts on Wall Street recommend one strong buy, three buys, five holds and one underperform rating. The average target price is $22.73 per share.
SpartanNash Co
The third stock that qualifies is SpartanNash Co (SPTN, Financial), a Grand Rapids, Michigan-based distributor and retailer of grocery products.
SpartanNash Co was trading at $19.95 per share at close on Friday compared to the GF Value of $21.46, resulting in a price-to-GF Value ratio of 0.93 and a rating of fairly valued.
The stock has risen 21.42% up to a market capitalization of $723.65 million over the past year. The 52-week range is $12.52 to $23.94.
The price-earnings ratio is 9.45 (compared to the industry median of 18.71) and the price-book ratio is 0.97 (versus the industry median of 1.83). The price-sales ratio is 0.08 (versus the industry median of 0.49) and the price-to-free cash flow ratio is 2.95 (versus the industry median of 11.21).
GuruFocus has assigned the stock a profitability rating of 6 out of 10.
In regard to future business performance, sell-side analysts on Wall Street anticipate that the earnings per share will rise by 20.65% on average every year over the next five years. As of April, the stock has one strong buy recommendation rating, five hold recommendation ratings and one sell recommendation rating, for an average target price of $22 per share.
Disclosure: I have no positions in any securities mentioned.
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