Value investors may want to consider the following stocks, as they have low price-sales ratios, high profitability and robust financial conditions. These three aspects result in a significant likelihood that these stocks could be value opportunities, in my opinion.
Alamo Group Inc
The first stock to consider is Alamo Group Inc ALG, a Seguin, Texas-based manufacturer and seller of farm and heavy construction machineries.
The stock price closed at $138.08 per share on Nov. 17 for a price-sales ratio of 1.36, which appeals more than the S&P 500's price-sales ratio of 2.63.
Alamo has a GuruFocus profitability rating of 8 out of 10, driven by a return on equity (ROE) ratio of 10.15% (versus the industry median of 4.46%) and a return on capital (ROC) ratio of 17.49% (versus the industry median of 8.52%).
The company has received a GuruFocus financial strength rating of 6 out of 10. The rating is driven by an equity-to-asset ratio of 0.52 (compared to the industry median of 0.44) and an Altman Z-Score of 4.08.
Following a 21.2% increase over the past year, the stock has a market capitalization of $1.64 billion and a 52-week range of $70.99 to $140.
Wall Street sell-side analysts recommend a buy rating for this stock and have established an average target price of $139 per share.
ASGN Inc
The second stock to consider is ASGN Inc ASGN, a Glen Allen, Virginia-based provider of professional staffing and IT solutions to several private and public organizations in the U.S. and internationally.
The stock price closed at $84.34 per share on Nov. 17 for a price-sales ratio of 1.13, which is more compelling than the S&P 500's price-sales ratio of 2.63.
ASGN has a GuruFocus profitability rating of 8 out of 10. It is driven by a ROC ratio of 56% (versus the industry median of 11.7%), a three-year revenue growth rate of 17.4% (versus the industry median of 5%) and a three-year earnings per share (EPS) without non-recurring items (NRI) growth rate of 22% (versus the industry median of 6.7%).
The company has received a positive GuruFocus financial strength rating of 6 out of 10. It is driven by a Piotroski F-Score of 6 out of 9 and an Altman Z-Score of 3.7 (greater than 2.99), indicating the existence of solid financial conditions.
Following a 26.5% increase over the past year, the stock now has a market capitalization of $4.46 billion, while the 52-week range is $29.04 to $85.51.
Wall Street sell-side analysts recommend an overweight rating for this stock and have established an average target price of $78.71 per share.
Carlisle Companies Inc
The third stock to consider is Carlisle Companies Inc CSL, a Scottsdale, Arizona-based diversified manufacturer of engineered products for companies operating in the building, aerospace and defense, medical, electronics and automotive industries.
The stock price closed at $144.33 per share on Nov. 17 for a price-sales ratio of 1.86, which is more compelling than the S&P 500 price-sales ratio of 2.63.
Carlisle has a GuruFocus profitability rating of 7 out of 10. It is driven by a three-year revenue growth rate of 16.6% (versus the industry median of 4.3%), a three-year Ebitda growth rate of 21.2% (versus the industry median of 5.3%) and a three-year EPS without NRI growth rate of 32.5% (versus the industry median of 3.35%).
The company has a positive GuruFocus financial strength rating of 5 out of 10, driven by an Altman Z-Score of 3.67 and a return on invested capital (ROIC) of 9.1%, which exceeds the weighted average cost of capital (WACC) of 5.75%.
As a result of an 11.4% decline that occurred over the past year, the stock has a market capitalization of $7.7 billion, while the 52-week range is $97.55 to $169.86.
Wall Street recommends an overweight rating for this stock and has established a target price of $149.88 per share.
Disclosure: I have no positions in any securities mentioned in this article.
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