As of March 30, the following companies could be undervalued by the market, as their price-earnings ratios are below 20 and their price-earnings to growth (aka PEG) ratios stand below 1.
Furthermore, these stocks have received positive recommendation ratings of overweight to buy from sell-side analysts on Wall Street.
BioSpecifics Technologies
The first company that meets the above-listed criteria is BioSpecifics Technologies Corp (BSTC, Financial).
Shares of the Wilmington, Delaware-based biotech developer of injectable collagenase traded at a price of $51.50 per unit at close on Friday for a market capitalization of $377.84 million.
The stock has a price-earnings ratio of 15.51, which is better than the industry median of 31.47, and a PEG ratio of 0.58, which is better than the industry median of 2.19.
The share price has fallen 10% so far this year and now it is about 10.3% below the middle point of the 52-week range of $42 to $72.83.
GuruFocus assigned a very good score of 8 out of 10 to the company’s financial strength rating and the near top score of 9 out of 10 to the profitability rating.
Wall Street sell-side analysts recommend a buy rating for this stock and have established an average target price of $90 per share.
John Bean Technologies
The second company that meets the above-listed criteria is John Bean Technologies Corp (JBT, Financial).
Shares of the Chicago-based provider of technology solutions to food and beverage businesses and equipment and services to air transportation companies traded at a price of $74.52 per unit on Friday for a market capitalization of $2.36 billion.
The stock has a price-earnings ratio of 18.58, which is less convenient than the industry median of 13.46. Also, the stock has a PEG ratio of 0.73, which is better than the industry median of 1.35.
Year to date, the share price has dropped 34% and now trades at an almost 20% discount to the middle point of the 52-week range of $56.54 to $127.97.
GuruFocus assigned the company a moderate financial strength rating of 5 out of 10 and a high profitability rating of 8 out of 10.
Wall Street sell-side analysts issued an overweight recommendation rating for this stock with an average target price of $101 per share.
PagSeguro Digital
The third company that meets the above-listed criteria is PagSeguro Digital Ltd (PAGS, Financial).
Shares of the Brazilian provider of financial technology solutions and services to micro, small and medium-sized merchants in Brazil and internationally traded at a price of $18.82 at close on Friday for a market capitalization of $6.2 billion.
The price-earnings ratio of 18.27 is less compelling than the industry median of 17.76. However, the PEG ratio of 0.18 is still much better than the industry median of 1.58.
So far this year, the share price has declined significantly, losing 45%. The share price currently trades just a few steps away from the lower limit of the 52-week range is $13.58 to $53.43.
GuruFocus has assigned a very positive rating of 7 out of 10 for the company’s financial strength and a moderate score of 5 out of 10 to the profitability rating.
Wall Street sell-side analysts recommend an overweight rating for this stock and have established an average target price of 173.96 Brazilian real ($34.10) per share.
Disclosure: I have no positions in any securities mentioned.
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