7 Undervalued Stocks With Growing Book Values

DCF calculator selects stocks with high margins of safety

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Jun 26, 2017
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The following companies have grown their book values per share (BV/S) over the last 10 years.

BV/S is calculated as total equity minus preferred stock, divided by shares outstanding (EOP). Theoretically, it is what shareholders will receive if the company is liquidated. Total equity is a balance sheet item and equal to total assets minus total liabilities. Because the BV/S may not reflect the company’s true value, some investors check the tangible book value to confirm their investment ideas.

The BV/S of Alliance Resource Partners LPĂ‚ (ARLP, Financial) has grown by 18% over the last 10 years. The current price-book (P/B) ratio is 1.3, and the price to tangible book ratio is 1.4.

Alliance Resource produces coal with varying sulfur and heat contents for utilities and industrial users. It operates in the Illinois Basin and Appalachian regions.

According to the discounted cash flow (DCF) calculator, the stock is undervalued and is trading with a margin of safety of 65% at $19.20. The price has been as high as $26.65 and as low as $13.95 in the last 52 weeks. It is 27.95% below its 52-week high and 37.63% above its 52-week low. The price-earnings (P/E) ratio is 4.64.

Jim Simons (Trades, Portfolio) is the largest shareholder of the company among the gurus with 0.1% of outstanding shares.

The BV/S of American Public Education Inc. (APEI, Financial) has grown by 29% over the last 10 years. The current P/B ratio is 1.4, and the price to tangible book ratio is 1.6.

The company provides online and on-campus postsecondary education through its two subsidiaries, American Public University System Inc. and National Education Seminars Inc.

According to the DCF calculator, the stock is undervalued and is trading with a margin of safety of 22% at $23.25. The price has been as high as $30.78 and as low as $14.75 in the last 52 weeks. It is 24.46% below its 52-week high and 57.63% above its 52-week low. The P/E ratio is 20.58.

The company’s largest shareholder among the gurus is Simons with 5.03% of outstanding shares, followed by Private Capital (Trades, Portfolio) with 1.5%, Chuck Royce (Trades, Portfolio) with 0.71%, Barrow, Hanley, Mewhinney & Strauss with 0.47%, Paul Tudor Jones (Trades, Portfolio) with 0.11% and Joel Greenblatt (Trades, Portfolio) with 0.07%.

The BV/S of Alliance Holdings GP LPĂ‚ (AHGP, Financial) has grown by 11% over the last 10 years. The current P/B ratio is 2.4, and the price to tangible book ratio is 3.1.

Alliance Holdings produces and markets coal. The company's ARLP Partnership operates 10 underground mining complexes in Illinois, Indiana, Kentucky, Maryland and West Virginia.

According to the DCF calculator, the stock is undervalued and is trading with a margin of safety of 59% at $24.12. The price has been as high as $32.70 and as low as $19 in the last 52 weeks. It is 26.24% below its 52-week high and 26.95% above its 52-week low. The P/E ratio is 6.85.

Simons is the largest shareholder of the company among the gurus with 0.14% of outstanding shares.

The BV/S of Bed Bath & Beyond Inc. (BBBY, Financial) has grown by 7% over the last 10 years. The current P/B ratio is 1.6, and the price to tangible book ratio is 2.2.

Bed Bath & Beyond operates a chain of retail stores, including Bed Bath & Beyond, Christmas Tree Shops, Harmon, buybuy BABY and World Market.

According to the DCF calculator, the stock is undervalued and is trading with a margin of safety of 60% at $29.65. The price has been as high as $48.83 and as low as $29.41 in the last 52 weeks. It is 39.28% below its 52-week high and 0.82% above its 52-week low. The P/E ratio is 6.88.

Hotchkis & Wiley is the largest shareholder of the company among the gurus with 5.62% of outstanding shares, followed by PRIMECAP Management (Trades, Portfolio) with 1.82%, Greenblatt with 0.38%, Ray Dalio (Trades, Portfolio) with 0.28%, Robert Olstein (Trades, Portfolio) with 0.24% and Jeremy Grantham (Trades, Portfolio) with 0.12%.

The BV/S of Open Text Corp. (OTEX, Financial) has grown by 15% over the last 10 years. The current P/B ratio is 2.4.

Open Text provides software products and services. It assists organizations in finding, utilizing and sharing business information.

According to the DCF calculator, the stock is undervalued and is trading with a margin of safety of 74% at $32.06. The price has been as high as $35.21 and as low as $13.29 in the last 52 weeks. It is 8.95% below its 52-week high and 13.29% above its 52-week low. The P/E ratio is 7.54.

The company’s largest shareholder among the gurus is Richard Snow (Trades, Portfolio) with 0.32% of outstanding shares, followed by Grantham with 0.09%, Simons with 0.09% and Greenblatt with 0.08%.

The BV/S of Genesco Inc. (GCO, Financial) has grown by 12% over the last 10 years. The current price-book (P/B) ratio is 0.7, and price to tangible book ratio is 1.2.

Genesco markets footwear, apparel and accessories through retail stores.

According to the DCF calculator, the stock is undervalued and is trading with a margin of safety of 61% at $32.90. The price has been as high as $74.21 and as low as $31.80 in the last 52 weeks. It is 55.67% below its 52-week high and 3.46% above its 52-week low. The P/E ratio is 7.46.

Chuck Akre (Trades, Portfolio) is the largest shareholder of the company among the gurus with 3.37% of outstanding shares, followed by Barrow, Hanley, Mewhinney & Strauss with 0.37%, Jones with 0.03% and Greenblatt with 0.03%.

The BV/S of United Natural Foods Inc.Ă‚ (UNFI, Financial) has grown by 14% over the last 10 years. The P/B ratio is 1.1, and the price to tangible book ratio is 1.7.

United Natural Foods is a wholesale distributor of natural, organic and specialty foods and other products.

According to the DCF calculator, the stock is undervalued and is trading with a margin of safety of 11% at $34.60. The price has been as high as $52.18 and as low as $29.53 in the last 52 weeks. It is 33.69% below its 52-week high and 17.17% above its 52-week low. The P/E ratio is 13.90.

Ken Fisher (Trades, Portfolio) is the largest shareholder of the company among the gurus with 1.33% of outstanding shares, followed by Gabelli with 0.89%, RS Investment Management (Trades, Portfolio) with 0.55%, Royce with 0.36%, John Hussman (Trades, Portfolio) with 0.32% and Greenblatt with 0.06%.

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