A price-earnings ratio below 20 and a price-earnings to growth ratio of less than 1 indicate that the following companies may be undervalued as of May 1.
Furthermore, Wall Street sell-side analysts have issued positive recommendation ratings for them.
Bio-Rad Laboratories
The first company that meets the above-listed criteria is Bio-Rad Laboratories Inc. (BIO, Financial), a Hercules, California-based manufacturer and marketer of devices for clinical diagnostic and life science research organizations in North America and internationally.
Shares of Bio-Rad Laboratories were trading at $431.79 per unit at close on Friday for a market capitalization of $12.94 billion.
The price-earnings ratio of 7.42 and a PEG ratio of 0.17 are much more compelling than most of their peers as the industry medians stand at 30.51 and 2.87, respectively.
The share price has risen 40% over the past year to nearly 18% above the midpoint of the 52-week range of $281.66 to $450.89.
GuruFocus assigned a very good score of 7 out of 10 to both the company’s financial strength and its profitability.
Wall Street sell-side analysts recommend a buy rating for this stock and have established an average target price of $448.75 per share.
Ligand Pharmaceuticals
The second company that meets the criteria is Ligand Pharmaceuticals Inc. (LGND, Financial). Based in San Diego, the company provides pharmaceutical companies worldwide with technologies for discovering and developing medical treatments.
Shares of Ligand Pharmaceuticals were trading at a price of $93 per unit on Friday for a market capitalization of $1.49 billion.
The price-earnings ratio is 3.17, which is much more compelling than the industry median of 37.12, and the PEG ratio of 0.03 stands significantly lower than the industry median of 2.5.
The share price has declined 23.5% over the past year to trade, though only marginally above the midpoint of the 52-week range of $57.24 to $130.14.
GuruFocus assigned the company a moderate financial strength rating of 5 out of 10 and a very high rating of 8 out of 10 for its profitability.
Wall Street sell-side analysts issued an overweight recommendation rating for this stock and have established an average target price of $176.33 per share. The overweight rating means that the stock is expected to outperform either the industry or the entire market within a year.
Hoegh LNG Partners
The third company that meets the screening criteria is Hoegh LNG Partners LP (HMLP, Financial), an oil and gas midstream operator based in Bermuda.
Shares of Hoegh LNG Partners were trading at a price of $11.14 at close on Friday for a market capitalization of $370.81 million.
The price-earnings ratio of 10.04 is a bit higher than the industry median of 8.58, topping 244 out of a total 562 competitors operating in the oil and gas industry. The PEG ratio of 0.19 is below the industry median of 0.84.
The share price has dropped nearly 43% over the past year to trade at about a 9.7% discount to the midpoint of the 52-week range of $4.67 to $19.98.
GuruFocus has assigned a moderate score of 4 out of 10 to the company’s financial strength and a high score of 8 out of 10 to its profitability.
Wall Street sell-side analysts recommend an overweight rating for this stock and have established an average target price of $11.55 per share.
Disclosure: I have no positions in any securities mentioned.
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