5 Stocks With a Margin of Safety and High Profitability

CAI International makes the list

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Apr 08, 2021
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According to the GuruFocus discounted cash flow calculator as of April 8, the following companies have a high margin of safety and have grown their margins over a 10-year period.

CAI International

CAI International Inc.'s (CAI) net margin and operating margin have grown by 24.56% and 46.28% per annum, respectively, over the past 10 years.

According to the DCF calculator, the stock is undervalued with a 5.68% margin of safety at $44.83 per share. The price-earnings ratio is 42.33. The share price has been as high as $50.21 and as low as $12.77 in the last 52 weeks; it is currently 10.71% below its 52-week high and 250.92% above its 52-week low.

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The global transportation finance and logistics company has a market cap of $774.35 million and an enterprise value of $2.57 billion.

The company's largest guru shareholder is Donald Smith & Co with 1.21% of outstanding shares.

Getty Realty

The net margin of Getty Realty Corp. (GTY) has grown 34.41% per annum over the past decade. The operating margin has grown 45.44% per annum over the same period.

According to the DCF calculator, the stock is undervalued with a 16.60% margin of safety at $29.49 per share. The price-earnings ratio is 18.34. The share price has been as high as $31.89 and as low as $19.81 in the last 52 weeks; it is currently 7.55% below its 52-week high and 48.86% above its 52-week low.

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The U.S. real estate investment trust has a market cap of $1.28 billion and an enterprise value of $1.81 billion.

With 4.38% of outstanding shares, Jim Simons (Trades, Portfolio)' Renaissance Technologies is the company's largest guru shareholder, followed by Pioneer Investments (Trades, Portfolio) with 0.05% and Paul Tudor Jones (Trades, Portfolio) with 0.02%.

PRA Group

PRA Group Inc. (PRAA) has grown its net margin and operating margin by 18.94% and 47.05%, respectively, per year over the past decade.

According to the DCF calculator, the stock is undervalued with a 24.55% margin of safety at $36.20 per share. The price-earnings ratio is 11.04. The share price has been as high as $47.35 and as low as $20.58 in the last 52 weeks; it is currently 23.56% below its 52-week high and 75.87% above its 52-week low.

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The company, which operates in the credit services industry, has a market cap of $1.65 billion and an enterprise value of $4.30 billion.

The company's largest guru shareholder is Barrow, Hanley, Mewhinney & Strauss with 3.26% of outstanding shares, followed by Simons' firm with 0.72%.

Gray Television

The net margin of Gray Television Inc. (GTN) has grown 8.05% per annum over the past decade. The operating margin has grown 26.67% annually over the same period.

According to the DCF calculator, the stock is undervalued with a 87.84% margin of safety at $19.16 per share. The price-earnings ratio is 5.01. The share price has been as high as $21.21 and as low as $9.44 in the last 52 weeks; it is currently 9.66% below its 52-week high and 102.97% above its 52-week low.

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The television broadcast company has a market cap of $1.82 billion and an enterprise value of $5.73 billion.

The company's largest guru shareholder is Simons' firm with 0.48% of outstanding shares, followed by Mario Gabelli (Trades, Portfolio) with 0.40% and John Hussman (Trades, Portfolio) with 0.21%.

McGrath Rent

McGrath Rent Corp.'s (MGRC) net margin and operating margin have grown 13.39% and 21.84%, respectively, per year over the past 10 years.

According to the DCF calculator, the stock is undervalued with a 16.06% margin of safety at $82 per share. The price-earnings ratio is 19.67. The share price has been as high as $86.76 and as low as $45.71 in the last 52 weeks; it is currently 5.49% below its 52-week high and 79.39% above its 52-week low.

The rental company has a market cap of $1.97 billion and an enterprise value of $2.20 billion.

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With 0.91% of outstanding shares, Chuck Royce (Trades, Portfolio) is the company's largest guru shareholder, followed by Simons' firm with 0.12% and Gabelli with 0.10%.

Disclosure: I do not own any stocks mentioned.

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