Growth-oriented investors may want to consider the following stocks, since they represent businesses with price-earnings ratios below 20 that recorded significant improvements in their trailing 12-month earnings per share over the past year.
Telefonaktiebolaget L M Ericsson
The first company that qualifies is Telefonaktiebolaget L M Ericsson (ERIC, Financial), a Stockholm, Sweden-based information and communications technology solutions provider in North America and internationally.
The trailing 12-month diluted net earnings per share were $0.69 as of the three months ended Sept. 30, growing 44% from $0.48 in the prior-year quarter.
The price-earnings ratio is 16.42 (versus the industry median of 22.34) as of Monday.
Following an 8.6% decline over the past year, the stock traded at $10.85 per share at close on Monday for a market capitalization of $36.13 billion and a 52-week range of $9.93 to $15.31.
GuruFocus assigned a score of 6 out of 10 to the company's financial strength and its profitability.
On Wall Street, the stock has a median recommendation rating of overweight and an average target price of $14.43 per share.
PRIMECAP Management (Trades, Portfolio) is the largest top fund holder of the company with 3.17% of total shares outstanding. The investment firm is followed by HOTCHKIS & WILEY with 0.73% and MUFG Securities EMEA plc with 0.42% of shares outstanding.
Williams-Sonoma Inc.
The second company that makes the cut is Williams-Sonoma Inc. (WSM, Financial), a San Francisco-based specialty retailer of home goods.
The trailing 12-month diluted net earnings per share increased by 95.2% to $13.31 as of the fiscal quarter ended Oct. 30, up from $6.82 as of the same fiscal quarter in the prior year.
The price-earnings ratio is 12.75 (versus the industry median of 17.78) as of Monday.
After a 62.4% increase that occurred over the past year, the stock was trading around $168.61 per share on Monday for a market capitalization of $12.40 billion and a 52-week range of $98.75 to $223.32.
GuruFocus assigned a score of 7 out of 10 to the company's financial strength and 9 out of 10 to its profitability.
On Wall Street, the stock has a recommendation rating of hold with a target price of $209.33 per share.
Among the top fund holders of the company, VANGUARD GROUP INC is the largest with 10.52% of shares outstanding, followed by BlackRock Inc. with 9.82% and Capital Research Global Investors with 7.74%.
WestRock Company
The third company that matches the criteria is WestRock Company (WRK, Financial), an Atlanta, Georgia-based global manufacturer and seller of paper and packaging solutions.
The trailing 12-month diluted net earnings per share were $3.13 as of the quarter that ended on Sept. 30, representing a turnaround from the net loss of $2.67 as of the prior-year quarter.
The price-earnings ratio is 14.11 (versus the industry median of 16.59) as of Monday.
Following a 2.2% increase over the past year, the stock was trading around $43.76 per share at close on Monday for a market capitalization of $11.58 billion and a 52-week range of $40.04 to $62.03.
GuruFocus assigned a score of 4 out of 10 to the company's financial strength and 6 out of 10 to its profitability.
On Wall Street, the stock has a median recommendation rating of overweight and an average target price of $56.92 per share.
PRICE T ROWE ASSOCIATES INC /MD/ is the largest shareholder of the company with 11.89% of total shares outstanding, followed by VANGUARD GROUP INC with 11.35% and BlackRock Inc. with 7.87%.
