When screening the market for bargains, investors may want to consider the following stocks since their share prices are trading below the intrinsic value calculated by GuruFocus' free cash flow-based discounted cash flow calculator.
Additionally, Wall Street has issued positive recommendation ratings for these companies, which means they expect higher share prices over the coming months.
Texas Capital Bancshares
The first stock investors could be interested in is Texas Capital Bancshares Inc. (TCBI, Financial), a Dallas-based regional bank mainly serving commercial businesses, professionals and entrepreneurs.
The stock closed at $62.03 per share on Friday, which is below the intrinsic value of $173.19 calculated from the DCF model, yielding a margin safety of 64.18%.
The share price has dropped by 26.73% over the past year, determining a market capitalization of $3.14 billion and a 52-week range of $54.27 to $90.52.
GuruFocus has assigned a score of 4 out of 10 to the company's financial strength and 6 out of 10 rating to its profitability.
On Wall Street, the stock has a median recommendation rating of hold with an average target price of $69.36 per share.
PennyMac Financial Services
The second stock investors could be interested in is PennyMac Financial Services Inc. (PFSI, Financial), a Westlake Village, California-based provider of mortgage banking and investment management services.
The stock closed at $55.36 per share on Friday, which is below the intrinsic value of $512.43 calculated by the DCF model, yielding a margin safety of 89.20%.
The share price has dropped by 12.90% over the past year, determining a market capitalization of $3.07 billion and a 52-week range of $53.87 to $71.52.
GuruFocus has assigned a score of 3 out of 10 to the company's financial strength and 9 out of 10 to its profitability.
On Wall Street, the stock has a median recommendation rating of overweight with an average target price of $87 per share.
Hilltop Holdings
The third stock investors could be interested in is Hilltop Holdings Inc. (HTH, Financial), a Dallas, Texas-based regional bank.
The stock closed at $30.42 per share on Friday, below the intrinsic value calculated from the DCF model of $125.27. The margin of safety stands at 75.72%.
The share price has fallen by 16.24% over the past year for a market capitalization of $2.40 billion and a 52-week range of $28.87 to $39.14.
GuruFocus has 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 hold and an average target price of $35.13 per share.
