Benjamin Graham, the father of value investing and author of "The Intelligent Investor," recommended considering stocks whose "Graham blended multiplier," which is the price-earnings ratio multiplied by the price-book ratio, is less than or equal to 22.5. Such stocks are likely trading at a discount to their intrinsic value.
Thus, investors may want to have a look at the following companies, as their Graham blended multipliers stand below 22.5.
Weis Markets Inc
The first stock to have a look at is Weis Markets Inc (WMK, Financial), a Sunbury, Pennsylvania-based grocery store chain company.
Shares of Weis Markets were trading at a price of $47.88 each at close on June 11 for a market capitalization of $1.29 billion.
The stock has a Graham blended multiplier of 19.28, as the price-earnings ratio is 16.07 (versus the industry median of 20.31) and the price-book ratio is 1.2 (versus the industry median of 1.55).
The share price increased by 27.5% in the past year, determining a 52-week range of $32.44 to $59.39.
The stock grants a dividend yield of around 2.58% as of June 11.
GuruFocus assigned a positive rating of 6 out of 10 for the company’s financial strength and a very good rating of 7 out of 10 for its profitability.
Wall Street sell-side analysts issued a hold recommendation rating for the stock.
Seacoast Banking Corp of Florida
The second stock to have a look at is Seacoast Banking Corp of Florida (SBCF, Financial), a Stuart, Florida-based regional bank.
Shares of Seacoast Banking were trading at $20.50 each at close on June 11 for a market capitalization of $1.08 billion.
The stock has a Graham blended multiplier of 15.07, as the price-earnings ratio is 13.95 (versus the industry median of 9.78) and the price-book ratio is 1.08 (versus the industry median of 0.79).
The share price decreased by 15.5% in the past year, determining a 52-week range of $13.30 to $31.42.
GuruFocus assigned a low rating of 3 out of 10 for the company’s financial strength and a moderate rating of 4 out of 10 for its profitability.
As of June, Wall Street sell-side analysts issued one strong buy recommendation rating, three buy recommendation ratings and three hold recommendation ratings for this stock.
Southside Bancshares Inc
The third company to have a look at is Southside Bancshares Inc (SBSI, Financial), a Tyler, Texas-based regional bank.
Shares of Southside Bancshares were trading at $27.25 each at close on June 11 for a market capitalization of $899.57 million.
The stock has a Graham blended multiplier of 17.96, as the price-earnings ratio is 15.48 (versus the industry median of 9.78) and the price-book ratio is 1.16 (versus the industry median of 0.79).
The share price decreased 17.33% in the past year, which has determined a 52-week range of $23.74 to $37.89.
The stock offers a dividend yield of around 4.54% as of June 11.
GuruFocus assigned a low rating of 2 out of 10 for the company’s financial strength and a moderate rating of 4 out of 10 for its profitability.
The stock has a hold recommendation rating on Wall Street.
Disclosure: I have no positions in any securities mentioned.
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