8 Undervalued Stocks for the Peter Lynch Ratio

Stocks trading with wide margins of safety

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Feb 27, 2017
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According to the GuruFocus All-in-One Screener, several gurus are focusing on stocks whose Peter Lynch fair values are far above the current prices. The following stocks are trading with wide margins of safety and have positive performances over the past 12 months.

Wi-LAN Inc. (WILN) is trading around $1.83 per share. The Peter Lynch value gives the stock a fair price of $2.3 so the stock is undervalued with a margin of safety of 22%. Twelve weeks back the stock started its positive upward trend; it now registers a positive performance of 36.3%.

The company develops, acquires and licenses a range of intellectual property that drives products in the communications and consumer electronics market, which includes wireless fidelity data over cable service, multimode wireless, bluetooth and V-Chip.

The stock is trading with a price-earnings (P/E) ratio of 20.37, which is higher than 56% of companies in the Global Communication Equipment industry. The price is 38.82% below its 52-week high and 46.46% above its 52-week low. The price-book (P/B) ratio is 0.88.

The company’s largest shareholder among the gurus is Jim Simons (Trades, Portfolio) with 1.11%.

Goldfield Corp. (GV) is trading around $7.35 per share. The Peter Lynch value gives the stock a fair price of $10.6 so the stock is undervalued with a margin of safety of 30%. Twelve weeks ago the stock started its positive upward trend; it now registers a positive performance of 113.0%.

The company through subsidiaries is engaged in the construction and maintenance of electric utility facilities and the installation of fiber optic cable for fiber optic cable manufacturers, telecommunication companies and electric utilities.

The stock is trading with a P/E ratio of 14.80, which is higher than 53% of companies in the Global Engineering & Construction industry. The price is 4.52% below its 52-week high and 537.93% above its 52-week low. The P/B ratio is 4.13.

Simons with 6.4% of outstanding shares is the largest investor among the gurus.

DRDGold Ltd. ADRĂ‚ (DRD) is trading around $6.15 per share. The Peter Lynch value gives the stock a fair price of $14.78 so the stock is undervalued with a margin of safety of 58%. Twelve weeks back the stock started its positive upward trend; it now registers a positive performance of 47.5%.

It is a South African gold mining company engaged in surface gold tailings retreatment including exploration, extraction, processing and smelting.

The stock is trading with a P/E ratio of 18.44, which is higher than 50% of companies in the Global Gold industry. The price is 32.42% below its 52-week high and 92.19% above its 52-week low. The P/B ratio is 2.26.

The company’s largest shareholder among the gurus is Simons with 3.79% followed by RS Investment Management (Trades, Portfolio) with 0.07%.

Itau Unibanco Holding SA ADRĂ‚ (ITUB) is trading around $12.81 per share. The Peter Lynch value gives the stock a fair price of $19.18 so the stock is undervalued with a margin of safety of 32%. Twelve weeks ago the stock started its positive upward trend; it now registers a positive performance of 26.3%.

The company provides financial products and services in Brazil. It provides investment banking, consumer credit card, real estate financing, leasing, foreign exchange and foreign trade financing services.

The stock is trading with a P/E ratio of 10.72, which is higher than 69% of companies in the Global Banks - Regional - Latin America industry. The price is 119.40% above its 52-week low and 3.88% below its 52-week low. The P/B ratio is 1.89.

Howard Marks (Trades, Portfolio) with 0.12% of outstanding shares is the largest investor among the gurus followed by Dodge & Cox with 0.09%, Jeremy Grantham (Trades, Portfolio) with 0.01% and Simons with 0.01%.

Redwood Trust Inc. (RWT) is trading around $17.02 per share. The Peter Lynch value gives the stock a fair price of $22.22 so the stock is undervalued with a margin of safety of 23%. Twelve weeks back the stock started its positive upward trend; it now registers a positive performance of 13.8%.

The company operates as a real estate investment trust. Together with its subsidiaries it is engaged in investing in mortgage- and other real estate-related assets and engaging in residential and commercial mortgage banking activities.

The stock is trading with a P/E ratio of 10.00, which is higher than 71% of companies in the Global REIT - Diversified industry. The price is 0.18% below its 52-week high and 67.19% above its 52-week low. The P/B ratio is 1.13.

The company’s largest shareholder among the gurus is Wallace Weitz (Trades, Portfolio) with 7.05% of outstanding shares followed by Simons with 1.75% and Jerome Dodson (Trades, Portfolio) with 1.43%.

American River Bankshares (AMRB) is trading around $15.06 per share. The Peter Lynch value gives the stock a fair price of $23.5 so the stock is undervalued with a margin of safety of 34%. Twelve weeks ago the stock started its positive upward trend; it now registers a positive performance of 11.7%.

It is a bank holding company that serves the commercial banking needs of small to midsized businesses. It accepts checking and savings deposits, offers money market deposit accounts and certificates of deposit, among others.

The stock is trading with a P/E ratio of 16.02, which is lower than 52% of companies in the Global Banks - Regional - US industry. The price is 5.82% below its 52-week high and 55.42% above its 52-week low. The P/B ratio is 1.19.

Michael Price (Trades, Portfolio) with 2.25% of outstanding shares is the largest investor among the gurus followed by Simons with 0.27%.

Gentex Corp. (GNTX) is trading around $20.91 per share. The Peter Lynch value gives the stock a fair price of $23.63 so the stock is undervalued with a margin of safety of 12%. Twelve weeks back the stock started its positive upward trend; it now registers a positive performance of 14.0%.

The company designs and manufactures automatic-dimming rearview mirrors and electronics for the automotive industry, dimmable aircraft windows for the aviation industry, and commercial smoke alarms and signaling devices for the fire protection industry.

The stock is trading with a P/E ratio of 17.43, which is higher than 53% of companies in the Global Auto Parts industry. The price is 4.48% below its 52-week high and 49.46% above its 52-week low. The P/B ratio is 3.14.

The company’s largest shareholder among the gurus is Chuck Royce (Trades, Portfolio) with 2.44% of outstanding shares followed by Columbia Wanger (Trades, Portfolio) with 0.96%, Pioneer Investments (Trades, Portfolio) with 0.23%, Simons with 0.12%, Mario Gabelli (Trades, Portfolio) with 0.09%, Grantham with 0.08%, Murray Stahl (Trades, Portfolio) with 0.01% and Joel Greenblatt (Trades, Portfolio) with 0.01%.

United Bancshares Inc. (UBOH) is trading around $22.85 per share. The Peter Lynch value gives the stock a fair price of $25.38 so the stock is undervalued with a margin of safety of 10%. Twelve weeks ago the stock started its positive upward trend; it now registers a positive performance of 14.0%.

It is a bank holding company. Through its subsidiary provides commercial and retail banking services including checking accounts, savings and money market accounts, certificates of deposit and wealth and treasury management services.

The stock is trading with a P/E ratio of 13.60, which is higher than 53% of companies in the Global Banks - Regional - US industry. The price is 3.38% below its 52-week high and 38.32% above its 52-week low. The P/B ratio is 1.04.

Disclosure: I do not own any shares of any stocks mentioned in this article.

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