4 Undervalued Stocks With Profitable Business

Canadian Pacific Railway makes the list

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Jun 18, 2021
Summary
  • They trade with a margin of safety based on the DCF calculator
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According to the GuruFocus discounted cash flow calculator as of June 18, the following companies have a high margin of safety and have grown their margins over a 10-year period.

Canadian Pacific Railway

The net margin of Canadian Pacific Railway Ltd. (CP) has grown 23.98% per annum over the past decade. The operating margin has grown 38.56% per annum over the same period.

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According to the DCF calculator, the stock is undervalued with a 39.46% margin of safety at $76.47 per share. The price-earnings ratio is 24.56. The share price has been as high as $83.07 and as low as $48.73 in the last 52 weeks; it is currently 7.95% below its 52-week high and 56.92% above its 52-week low.

The railroad operator has a market cap of $52 billion. With 0.05% of outstanding shares, Pioneer Investments (Trades, Portfolio) is the company's largest guru shareholder.

Amdocs

Amdocs Ltd. (DOX) has grown its net margin and operating margin by 11.79% and 13.77%, respectively, per year over the past decade.

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According to the DCF calculator, the stock is undervalued with a 7.75% margin of safety at $77.57 per share. The price-earnings ratio is 15.54. The share price has been as high as $82.38 and as low as $54.68 in the last 52 weeks; it is currently 5.84% below its 52-week high and 41.86% above its 52-week low.

The provider of software and services to the media industry, has a market cap of $10 billion. The company's largest guru shareholder is

Richard Pzena (Trades, Portfolio) with 3.42% of outstanding shares, followed by John Rogers (Trades, Portfolio) with 0.8% and Steven Cohen (Trades, Portfolio) with 0.7%.

Magellan Midstream

The net margin of Magellan Midstream Partners LP (MMP) has grown 35.12% per annum over the past decade. The operating margin has grown 36.71% annually over the same period.

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According to the DCF calculator, the stock is undervalued with a 36.95% margin of safety at $50.27 per share. The price-earnings ratio is 15.17. The share price has been as high as $53.85 and as low as $32.61 in the last 52 weeks; it is currently 6.65% below its 52-week high and 35.12% above its 52-week low.

The operator of pipelines and storage terminals has a market cap of $11.3 billion. The company's largest guru shareholder is

First Eagle Investment (Trades, Portfolio) with 0.40% of outstanding shares, followed by Mark Hillman (Trades, Portfolio) with 0.05% and George Soros (Trades, Portfolio) with 0.04%.

Highwoods Properties

Highwoods Properties Inc.'s (HIW) net margin and operating margin have grown 21.91% and 25.74%, respectively, per year over the past 10 years.

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According to the DCF calculator, the stock is undervalued with a 46.35% margin of safety at $45.91 per share. The price-earnings ratio is 22.29. The share price has been as high as $48.98 and as low as $29.18 in the last 52 weeks; it is currently 6.28% below its 52-week high and 57.32% above its 52-week low.

The real estate investment trust has a market cap of $4.7 billion. With 0.24% of outstanding shares, Simons’ firm is the company's largest guru shareholder, followed by

Chris Davis (Trades, Portfolio) with 0.17% and Jeremy Grantham (Trades, Portfolio) with 0.10%.

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Disclosures

I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours. Click for the complete disclosure
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