Investors looking for opportunities among growing companies may want to consider the following three stocks, as their share prices are trading lower than their Peter Lynch Fair Values.
The Peter Lynch Fair Value, which is based on the idea that the fair price-earnings (PE) ratio for a growing company matches its growth rate, stems from the combination of the following three components:
- The stock's PEG ratio.
- The stock's five-year Ebitda growth rate.
- The stock's earnings per share (EPS) without non-recurring items (NRI) for the trailing twelve months (TTM) through the most recent quarter.
Gazprom Neft PJSC
The first stock that makes the cut is Gazprom Neft PJSC GZPFY, a St. Petersburg, Russia-based crude oil and gas exploration and production company.
On Wednesday, Gazprom's share price closed at $21.70, significantly below its Peter Lynch Fair Value per share of $70.15, for a price-to-Peter-Lynch-Fair-Value ratio of about 0.31. This ranks higher than 80% of the 146 companies that operate in the oil and gas industry.
The stock has a market capitalization of $20.48 billion after a 40% decrease that occurred over the past year. The 52-week range is $15.01 to $37.18.
The stock has a GuruFocus financial strength rating of 5 out of 10 and a profitability rating of 9 out of 10.
As of January, the stock has a median recommendation rating of hold on Wall Street. The average target price is $23.46 per share.
Logitech International SA
The second stock that makes the cut is Logitech International SA LOGI, a Lausanne, Switzerland-based designer of products for connecting through computing, gaming, music, video and other global digital platforms.
On Wednesday, Logitech's share price closed at $28.93, well below the Peter Lynch Fair Value per share of $134.21, for a price-to-Peter-Lynch-Fair-Value ratio of about 0.80. This ranks higher than 78% of the 590 companies that operate in the hardware industry.
The stock has a market capitalization of $17.64 billion after a 129.67% increase that occurred over the past year. The 52-week range is $31.37 to $107.87.
The stock has a GuruFocus financial strength rating of 7 out of 10 and a profitability rating of 8 out of 10.
As of January, the stock has a median recommendation rating of overweight on Wall Street and an average target price of $115.74 per share.
Berry Global Group Inc
The third stock that makes the cut is Berry Global Group Inc BERY, an Evansville, Indiana-based provider of packaging and container solutions.
On Wednesday, Berry Global Group's share price closed at $49.19, substantially below its Peter Lynch Fair Value per share of $62.83, for a price-to-Peter-Lynch-Fair-Value ratio of about 0.78. This ranks higher than 76% of the 93 companies that operate in the packaging and containers industry.
The stock has a market capitalization of $6.59 billion after a nearly 7% increase that took place over the past year. The 52-week range is $25.00 to $57.94.
The stock has a GuruFocus financial strength rating of 4 out of 10 and a profitability rating of 4 out of 10.
As of January, the stock has a median recommendation rating of overweight on Wall Street. The average target price is $68.87 per share.
Disclosure: I have no position in any security mentioned.
Read more here:
- 3 High-Return Stock Picks
- A Trio of Low Price-to-Free-Cash-Flow Ratio Stocks to Consider
- A Trio of Potential Bargains
Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.
