As of Dec. 15, the three stocks below appear to be underestimated by the market, as their price-earnings ratios without non-recurring items stand below 20 while their price-earnings to growth (PEG) ratios stand below 1.
Furthermore, these stocks have received positive recommendation ratings from sell-side analysts on Wall Street.
Lennar Corp
The first company that makes the cut is Lennar Corp (LEN, Financial), a Miami, Florida-based homebuilder.
As of Dec. 15, the price-earnings ratio is 7.17, which appeals more than the industry median of 11.15, while the PEG ratio of 0.62 is less than the industry median of 0.71.
On Dec. 15, the closing price was $73.87 per share, net earnings without NRI were $10.30 per share for the trailing 12 months ended in August 2020 and the five-year Ebitda growth rate was 11.6%.
The share price has risen by 29.12% over the past year, determining a market capitalization of $22.54 billion and fluctuating in a 52-week range of $25.42 to $86.80.
GuruFocus assigned a score of 5 out of 10 for the company's financial strength and of 7 out of 10 for its profitability.
As of December, Wall Street sell-side analysts recommend seven strong buys, six buys and nine hold ratings for the stock. They have also established an average target price of $89.67 per share.
PulteGroup Inc
The second company that makes the cut is PulteGroup Inc (PHM, Financial), an Atlanta, Georgia-based home builder.
As of Dec. 15, the price-earnings ratio was 8.86 and the PEG ratio was 0.4, which are more compelling when compared to the respective industry medians of 11.15 and 0.71.
The closing price on Dec. 15 was $42.42 per share, while net earnings without NRI were $4.79 per share for the trailing 12 months ended in September and the five-year Ebitda growth rate was 22.20%.
The share price has risen by 7.3% over the past year for a market capitalization of $11.37 billion and a 52-week range of $17.12 to $49.70.
GuruFocus assigned a score of 7 out of 10 for the company's financial strength and a score of 8 out of 10 for its profitability.
As of December, Wall Street sell-side analysts recommend one strong buy, six buys, 14 holds and one sell rating for an average target price of $54.07 per share.
Alpha Pro Tech Ltd
The third company that makes the cut is Alpha Pro Tech Ltd (APT, Financial).
Based in Markham, Ontario (Canada), Alpha Pro Tech is a developer of construction weatherization products and manufacturer of several disposable protective apparel and infection control products such as shoe covers, lab coats, hoods, face masks and shields.
As of Dec. 15, the price-earnings ratio was 8.44, beating the industry median of 14.05, while the PEG ratio of 0.66 appeals more than the industry median of 1.32.
The closing price on Dec. 15 was $12.33 per share, while net earnings without NRI was $1.46 per share for the trailing 12 months ended in September and the five-year Ebitda growth rate was 12.7%.
The share price increased by nearly 265% over the past year for a market capitalization of $167.43 million and a 52-week range of $3.28 to $41.59.
GuruFocus assigned a score of 8 out of 10 to the company's financial strength rating and of 7 out of 10 to its profitability.
As of December, one sell-side analyst on Wall Street recommends a buy rating for the stock with a price target of $24.50 per share.
Disclosure: I have no positions in any securities mentioned in this article.
Read more here:
- A Trio of Stocks Growing Revenue Per Share Fast
- A Trio of Low Price-Book Ratio Stock Picks to Consider
- 3 High Earnings Return Stock Picks for the Value Investor
Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.
