One method to search for value opportunities is to look for stocks whose "Graham blended multiplier" is less than 22.5. Designed by Benjamin Graham, the pioneer of value investing, the multiplier is equal to the stock's price-earnings ratio multiplied by its price-book ratio.
Therefore, value investors could be interested in the following stocks, since their Graham blended multipliers are less than 22.5.
Lakeland Industries Inc
The first stock investors could be interested in is Lakeland Industries Inc (LAKE, Financial), a Decatur, Alabama-based manufacturer and seller of industrial protective clothing and accessories to global markets.
The stock has a Graham blended multiplier of 17.20, as the price-earnings ratio is 8.27 (versus the industry median of 19.47) and the price-book ratio is 2.08 (versus the industry median of 1.02).
Lakeland Industries Inc stock traded at $29.11 per share at close on March 8 for a market capitalization of $233.46 million.
The share price has grown 101.45% over the past year for a 52-week range of $12.44 to $47.95.
Lakeland Industries Inc does not pay dividends.
GuruFocus assigned a rating of 9 out of 10 to the company's financial strength and 5 out of 10 to its profitability.
On Wall Street, the stock has a median recommendation rating of buy with an average target price of $31.50 per share.
Old Second Bancorp Inc
The second stock investors could be interested in is Old Second Bancorp Inc (OSBC, Financial), an Aurora, Illinois-based regional bank.
The stock has a Graham blended multiplier of 19.86, as the price-earnings ratio is 14.82 (versus the industry median of 13.17) and the price-book ratio is 1.34 (versus the industry median of 0.99).
Old Second Bancorp stock traded at $13.78 per share at close on March 8 for a market capitalization of $404.15 million.
The share price has risen by 57.31% over the past year, determining a 52-week range of $5.96 to $13.88.
The company is currently paying quarterly dividends of 1 cent per common share to its shareholders for a trailing 12-month and forward dividend yield of 0.29% as of March 8.
GuruFocus assigned a rating of 3 out of 10 to the company's financial strength and of 4 out of 10 to its profitability.
On Wall Street, the stock has a median recommendation rating of buy with an average target price of $12.20 per share.
HomeStreet Inc
The third company investors could be interested in is HomeStreet Inc (HMST, Financial), a Seattle, Washington-based regional bank serving consumer and business clients in the Western United States.
The stock has a Graham blended multiplier of 19.40, as the price-earnings ratio is 13.38 (versus the industry median of 13.17) and the price-book ratio is 1.45 (versus the industry median of 0.99).
HomeStreet Inc stock traded at $46.98 per share at close on March 8 for a market capitalization of $1.02 billion.
The share price has risen by nearly 94% over the past year for a 52-week range of $18.44 to $47.54.
Currently, HomeStreet Inc pays quarterly dividends to its shareholders with the last payment of 25 cents per common share (up 66.7% from previous one) made on Feb. 2, for a trailing 12-month dividend yield of 1.49% and a forward dividend yield of 2.13% as of March 8.
GuruFocus assigned a score of 2 out of 10 to the company's financial strength and of 4 out of 10 to its profitability.
On Wall Street, the stock has a median recommendation rating of overweight and an average target price of $44 per share.
Disclosure: I have no positions in any securities mentioned.
Read more here:
- A Trio of Stocks for Growth-Focused Investors
- 2 Underperforming Holdings to Reduce
- 3 Tech Stock Picks for Growth-Oriented Investors
Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.
