A price-earnings ratio of less than 20 and a price-earnings to growth ratio of less than 1 suggest that the following companies may be underestimated as of April 8, 2020.
Furthermore, these stocks have received positive recommendation ratings of overweight to buy from sell-side analysts on Wall Street.
Applied Materials
The first company that has the above-listed screening criteria is Applied Materials Inc (AMAT, Financial).
Shares of the Santa Clara, California-based supplier of manufacturing equipment, services and software to semiconductor producers were trading at a price of $51.46 per unit at close on Wednesday for a market capitalization of $47.26 billion.
The stock has a price-earnings ratio of 17.04, which is less than the industry median of 19.15, and a PEG ratio of 0.61, which is better than the industry median of 1.63.
The share price has risen 22% over the past year and now is about 3% below the middle point of the 52-week range of $36.64 to $69.44.
GuruFocus assigned a positive score of 6 out of 10 to the company’s financial strength rating and a score of 9 out of 10 to the profitability rating.
Wall Street sell-side analysts recommend a buy rating for this stock and have set an average target price of $65.88 per share.
Ulta Beauty
The second company that has the above-listed screening criteria is Ulta Beauty Inc (ULTA, Financial).
Shares of the Bolingbrook, Illinois-based beauty retail chain were trading at a price of $200.57 per unit on Wednesday for a market capitalization of $11.29 billion.
The stock has a price-earnings ratio of 16.49, which is higher than the industry median of 12.57. The stock’s PEG ratio of 0.81 is better than the median for the industry, which stands at 1.51.
The share price has fallen 43% over the past 12 months of trading and now trades at an 18.5% discount to the middle point of the 52-week range of $124.05 to $368.83.
GuruFocus assigned the company a moderate financial strength rating of 5 out of 10 and the highest profitability rating of 10 out of 10.
Wall Street sell-side analysts issued an overweight recommendation rating for this stock with an average target price of $230.33 per share.
Lundin Mining
The third company that has the above-listed screening criteria is Lundin Mining Corp (LUNMF, Financial).
Shares of the Canadian explorer, developer and producer of copper and other base metals were trading at a price of $4.20 at close on Wednesday for a market capitalization of $3.08 billion.
The price-earnings ratio of 19.59 is higher than the industry median of 11.11. The PEG ratio of 0.91 is in line with the industry median.
The share price has decreased by 15.3% over the past year, placing it about 8.3% below the middle point of the 52-week range of $2.82 to $6.34.
GuruFocus has assigned a positive rating of 6 out of 10 for the company’s financial strength and a very good score of 7 out of 10 to the profitability rating.
Wall Street sell-side analysts recommend a buy rating for this stock and have set an average target price of $6.10 per share.
Disclosure: I have no positions in any securities mentioned.
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