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James Li
James Li
Articles (1282)  | Author's Website |

4 Stocks Trading Near Historical Low Price-Book Ratios

Companies have strong business predictability and are trading at historical low valuations

According to the Historical Low Price-Book Screener, a GuruFocus Premium value screen, four stocks trading near historical low price-book ratios are J2 Global Inc. (NASDAQ:JCOM), JM Smucker Co. (NYSE:SJM), Discovery Inc. (NASDAQ:DISCK)(NASDAQ:DISCA) and CVS Health Corp. (NYSE:CVS).

Dow caps week with a bang on coronavirus treatment hopes

On Friday, the Dow Jones Industrial Average closed at 26,075.30, up 369.21 points from Thursday’s close of 25,706.09 and 247.96 points from the July 2 close of 25,827.36.

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Stocks closed higher for the week on the heels of Gilead Sciences Inc. (GILD) reporting that its coronavirus treatment candidate, remdesivir, reduced the risk of mortality by 62% compared with standard care. The news come as several states in the U.S. report increasing mortality rates to Covid-19.

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To combat volatile market swings driven by the coronavirus, investors can seek companies with predictable revenue and earnings growth over the past 10 years and are now trading within 30% above their historical low price-book valuation. The Historical Low Price-Book Screen listed 26 such companies from U.S.-based exchanges, excluding over-the-counter stocks.

J2 Global

J2 Global closed at $56.99, just 0.26% above its 52-week low.

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The Los Angeles-based company provides business cloud services and digital media services. GuruFocus ranks J2 Global’s profitability 9 out of 10 on several positive investing signs, which include a high Piotroski F-score of 7, a five-star business predictability rank and an operating margin that is outperforming 89.02% of global competitors.

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Gurus with holdings in J2 Global include Ken Fisher (Trades, Portfolio)’s Fisher Asset Management, Chuck Royce (Trades, Portfolio)’s Royce & Associates and Jim Simons (Trades, Portfolio)’ Renaissance Technologies.

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JM Smucker

JM Smucker manufactures packaged food products, including strawberry jam and jelly. GuruFocus ranks the Orrville, Ohio-based company’s profitability 8 out of 10 on the back of operating margins increasing approximately 1.30% per year on average over the past five years and outperforming over 88% of global competitors. Other positive investing signs include price valuations trending near multiyear lows, contributing to a GuruFocus valuation rank of 6 out of 10.

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Discovery

Discovery broadcasts a wide range of content through its network brands, including Discovery, TLC, Animal Planet, HGTV and Food Network. GuruFocus ranks the Silver Spring, Maryland-based company’s profitability 9 out of 10 on several positive investing signs, which include a high Piotroski F-score of 8, a four-star business predictability rank and profit margins that outperform over 93% of global competitors.

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Discovery’s valuation ranks 10 out of 10 on the back of price valuations near 10-year lows. The company’s price-earnings ratio of 6.99 outperforms 83.53% of global diversified media companies.

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CVS

CVS Health provides health care services across over 10,000 pharmacy locations in the U.S. GuruFocus ranks the company’s profitability 8 out of 10, driven primarily by a five-star business predictability rank and a high Piotroski F-score of 7 despite operating margins underperforming 57.14% of global competitors.

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CVS Health’s valuation ranks 9 out of 10 on the back of price valuations outperforming over 83% of global competitors. The company’s price-earnings ratio tops 92.86% of global health care peers.

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Disclosure: The author is long J2 Global.

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About the author:

James Li
I am an editorial researcher at GuruFocus. I have a Master's in Finance from SMU, and I enjoy writing reports on financial trends and investor portfolios. Follow me on Twitter at @JamesLiGuru!

Visit James Li's Website


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pjmason14Momentum
pascal.van.garsseHigh FCF-M2
kosalmmuse6
kosalmmuseBest one1
DBrizanall 2019Feb26
kosalmmuseBest one
DBrizanall 2019Feb25
kosalmmuseNice
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MsDale*52-Week Low
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