One way to uncover value opportunities is to look for stocks that are trading below their Graham Number, as such stocks could be trading at discount to their intrinsic value. The Graham Number is calculated as the square root of "earnings per share times book value per share times 22.5."
Thus, investors may want to have a look at the following large-cap stocks, as they are trading below their Graham Numbers.
Bank Bradesco SA
The first stock to consider is Bank Bradesco SA (BBD, Financial), a Brazilian provider of bank services to individuals living and businesses operating in Brazil and internationally.
The stock traded at a price of $4.46 per share at close on Monday, which is below the Graham Number of $4.64 as of the December 2020 quarter, for a price-to-Graham-Number ratio of 0.96.
The share price has grown by 10.12% over the past year for a market capitalization of $39.42 billion and a 52-week range of $2.68 to $5.46.
GuruFocus has assigned a score of 3 out of 10 for the company's financial strength and 5 out of 10 for its profitability.
On Wall Street, the stock has a median recommendation rating of buy with an average price target of $6.12 per share.
Sprucegrove Investment Management Ltd and Standard Life Aberdeen plc are the two largest fund holders of the stock with 1.02% and 0.96%, respectively.
Allstate Corp
The second stock to consider is Allstate Corp (ALL, Financial), a Northbrook, Illinois-based provider of insurance products to clients in North America.
The stock traded at a price of $119.36 per share at close on Monday, which is below the Graham Number of $180.74 as of the December 2020 quarter, for a price-to-Graham-Number ratio of approximately 0.66.
The stock has risen by 16.52% over the past year for a market capitalization of $36.15 billion and a 52-week range of $84.97 to $119.62.
GuruFocus has assigned a score of 4 out of 10 for the company's financial strength and 7 out of 10 for its profitability.
On Wall Street, the stock has a median recommendation rating of overweight with an average price target of $130 per share.
BlackRock Inc., Vanguard Group Inc and State Street Corp are among the largest fund holders, owning 8.45%, 7.42% and 4.81% of the company's shares outstanding, respectively.
The Hartford Financial Services Group Inc
The third company to have a look at is The Hartford Financial Services Group Inc (HIG, Financial), a Hartford, Connecticut-based insurer and financial services provider in the U.S. and overseas.
The stock traded at a price of $66.52 per share at close on Monday, which is below the Graham Number of $67.76 as of the December 2020 quarter, for a price-to-Graham-Number ratio of 0.98.
Due to a 61.34% increase in its share price over the past year, the stock has a market capitalization of $23.77 billion and a 52-week range of $30.27 to $69.60.
GuruFocus has assigned a score of 4 out of 10 for the company's financial strength and 5 out of 10 for its profitability.
On Wall Street, the stock has a median recommendation rating of overweight with an average price target of $73.15 per share.
Vanguard Group Inc, BlackRock Inc. and JPMorgan Chase & Co are the first three largest fund holders of the company, owning 10.85%, 6.89% and 5.70% of the shares outstanding, respectively.
Disclosure: I have no positions in any security mentioned in this article.
Read more here:
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- 3 Stock Picks With a Low Shiller Price-Earnings Ratio
- A Trio of Stocks With a History of Sales and Earnings Growth
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