Here are six stocks gurus are buying that are trading with low price-earnings (P/E) ratios. Most of them are fairly valued, according to the DCF calculator.
With a market cap of $43 billion,Ă‚ Prudential Financial Inc. (PRU, Financial) is trading with a P/E ratio of 11.20 and a price-sales (P/S) ratio of 0.79. According to the discounted cash flow (DCF) calculator, the stock has a fair value of $96 while trading around $100, suggesting the stock is overpriced by 5%. The price has risen 28% over the last 12 months and is now 12.7% below its 52-week high and 29.53% above its 52-week low.
Prudential Financial’s revenue of $58 billion grew 8% over the last 10 years. Its earnings per share (EPS) of $9.71 grew 30%.
Jeremy Grantham (Trades, Portfolio) is the company’s largest shareholder among the gurus with 0.04% of outstanding shares, followed by John Buckingham (Trades, Portfolio) with 0.02%.
With a market cap of $25 billion,Ă‚ SunTrust Banks Inc. (STI, Financial) is trading with a P/E ratio of 14.30 and a P/S ratio of 3.02. According to the DCF calculator, the stock has a fair value of $40 while trading around $54. The stock is overpriced by 34%. The price has risen 24% over the last 12 months and is now 13% below its 52-week high and 42% above its 52-week low.
SunTrust's revenue of $8 billion declined 1.10% over the last five years while its EPS of $3.63 grew 22%.
Dodge & Cox is the company's largest shareholder among the gurus with 0.11% of outstanding shares, followed by Steven Cohen (Trades, Portfolio) with 0.06%.
With a market cap of $10 billion,Ă‚ Assurant Inc. (AIZ, Financial) is trading with a P/E ratio of 10.1 and a P/S ratio of 0.60. According to the DCF calculator, the stock has a fair value of $161 while trading around $152. The stock is overpriced by 6%. The price has risen 30% over the last 12 months and is now 1% below its 52-week high and 37% above its 52-week low.
Assurant’s revenue of $7,532 million grew 9.7% over the last five years while its EPS of $9.63 decreased 1.4%.
Jim Simons (Trades, Portfolio) is the company's largest guru shareholder with 0.02% of outstanding shares, followed by Caxton Associates (Trades, Portfolio) with 0.01%.
With a market cap of $4 billion,Ă‚ Lear Corp. (LEA, Financial) is trading with a P/E ratio of 13.7 and a P/S ratio of 0.81. According to the DCF calculator, the stock has a fair value of $75 while trading around $47. The stock has a margin of safety of 37%. The price has declined 8% over the last 12 months and is now 17% below its 52-week high and 10.73% above its 52-week low.
Lear’s revenue of $18 billion grew 14.7% over the last five years. Its EPS of $13.48 grew 13.5% over that same period.
With 0.21% of outstanding shares, Grantham is the company’s largest guru shareholder, followed by Cohen with 0.20%, Pioneer Investments (Trades, Portfolio) with 0.06% and Ken Fisher (Trades, Portfolio) with 0.03%.
With a market cap of $2 billion,Ă‚ LifePoint Health Inc. (LPNT, Financial) is trading with a P/E ratio of 12.4 and a P/S ratio of 0.4. According to the DCF calculator, the stock has a fair value of $47 while trading around $55. The stock is overpriced by 17%. The price has declined 6% over the last 12 months and is now 21% below its 52-week high and 10.77% above its 52-week low.
LifePoint Health’s revenue of $6,364 million grew 19.20% over the last five years. Its EPS of $2.9 increased just 0.10%.
Diamond Hill Capital (Trades, Portfolio) is the company’s largest shareholder among the gurus with 4.04% of outstanding shares, followed by Cohen with 2.28% and Hotchkis & Wiley with 1.04%.
With a market cap of $2 billion,Ă‚ Minerals Technologies Inc. (MTX, Financial) is trading with a P/E ratio of 14.6 and a P/S ratio of 1.4. According to the DCF calculator, the stock has a fair value of $47 while trading around $64. The stock is overpriced by 37%. The price has declined 7% over the last 12 months and is now 23.14% below its 52-week high and 3.04% above its 52-week low.
The company’s revenue of $1,638 million grew 14.70% over the last five years. Its EPS of $3.82 increased 13.70%.
With 3.13% of outstanding shares, Chuck Royce (Trades, Portfolio) is the company’s largest shareholder among the gurus, followed by Mario Gabelli (Trades, Portfolio) with 0.54% and Joel Greenblatt (Trades, Portfolio) with 0.15%.
Disclosure: I do not own any shares of any stocks mentioned in this article.
