1. How to use GuruFocus - Tutorials
  2. What Is in the GuruFocus Premium Membership?
  3. A DIY Guide on How to Invest Using Guru Strategies
Alberto Abaterusso
Alberto Abaterusso
Articles (2378) 

A Trio of Graham-Style Stocks That Appear to Be Fairly Priced

Their Graham blended multipliers are below 22.5

May 16, 2020 | About:

To increase the likelihood of discovering value opportunities, you should consider stocks whose Graham blended multiplier is 22.5 or less. Developed by Benjamin Graham, the pioneer of value investing, the multiplier equals the stock's price-earnings ratio times its price-book ratio.

The following three stocks have a Graham blended multiplier of 22.5 or less.

NorthWestern

The first stock to consider is NorthWestern Corp. (NASDAQ:NWE), a Sioux Falls, South Dakota-based provider of electricity and natural gas to residential, commercial and industrial customers.

Shares of NorthWestern closed at $54.25 on May 15 for a market capitalization of $2.74 billion.

The stock has a Graham blended multiplier of 20.22, as the price-earnings ratio is 15.32 and the price-book ratio is 1.32. The industry has a median of 15.19 for the price-earnings ratio and a median of 1.36 for the price-book ratio.

The stock appears to be fairly valued, as its share price is near the Peter Lynch earnings line.

The 52-week range is $45.06 to $80.52.

Wall Street sell-side analysts issued a moderate buy recommendation rating for this stock and have set an average target price of $64.75 per share.

Kaiser Aluminum

The second stock to consider is Kaiser Aluminum Corp. (NASDAQ:KALU), a Foothill Ranch, California-based manufacturer of semi-finished aluminum products for various industries.

Shares of Kaiser Aluminum closed at $58.84 on May 15 for a market capitalization of $929.06 million.

The stock has a Graham blended multiplier of 19.83, as the price-earnings ratio is 15.02 and the price-book ratio is 1.32. The industry has a median of 12.5 for the price-earnings ratio and of 1.4 for the price-book ratio.

The stock is priced fairly as it trades close to the Peter Lynch earnings line.

The 52-week range is $54.54 to $117.06.

Wall Street sell-side analysts issued a hold recommendation rating for this stock and have established an average target price of $102 per share.

TriMas

The third company to consider is TriMas Corp. (NASDAQ:TRS), a Bloomfield Hills, Michigan-based provider of various products for several end markets worldwide, including aerospace and industrial.

Shares of TriMas closed at $19.87 on May 15 for a market capitalization of $862.55 million.

The stock has a Graham blended multiplier of 12.58 as the price-earnings ratio is 9.68 and the price-book ratio is 1.3. The industry has a median of 16.21 for the price-earnings ratio and of 1.32 for the price-book ratio.

The Peter Lynch chart shows the stock is still trading cheaply as its share price is slightly below the earnings line.

The 52-week range is $18.05 to $33.45.

Wall Street sell-side analysts issued an overweight recommendation rating for the stock and have established an average target price of $25 per share.

Disclosure: I have no positions in any securities mentioned.

Read more here:

Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here. 

About the author:

Alberto Abaterusso
I am a contributor at GuruFocus. I primarily write about how to pick potential value stocks. Gold, silver and precious metals mining industries is also my cup of tea. My articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. I hold a Master\\\'s Degree in Business Administration from Università degli Studi di Bari (Italy), Aldo Moro. I am based in The Netherlands.

You can follow me on Twitter at https://twitter.com/AAbaterusso

Rating: 0.0/5 (0 votes)

Comments

Please leave your comment:



Performances of the stocks mentioned by Alberto Abaterusso


User Generated Screeners


pjmason14Momentum
pascal.van.garsseHigh FCF-M2
kosalmmuse6
kosalmmuseBest one1
DBrizanall 2019Feb26
kosalmmuseBest one
DBrizanall 2019Feb25
kosalmmuseNice
kosalmmusehan
MsDale*52-Week Low
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)