3 Potential Value Opportunities

The DCF model shows these stocks could have good value

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Mar 24, 2022
Summary
  • Landsea Homes, Olympic Steel and Citi Trends are trading at a discount to their DCF values.
  • Wall Street is also positive about these stocks.
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When seeking value opportunities, investors could be interested in the following stocks since their prices are trading at a discount to the intrinsic value calculated by GuruFocus' earnings-based discounted cash flow calculator.

Furthermore, sell-side analysts on Wall Street have issued positive recommendation ratings for these stocks, indicating they expect share prices to rise.

Landsea Homes

The first stock that meets the criteria is Landsea Homes Corp. (

LSEA, Financial), a Newport Beach, California-based designer, builder and seller of suburban and urban single-family and townhouse homes in California, Arizona, Florida, Texas and metropolitan New York.

The stock was trading around $8.73 per share at close on Wednesday, below the intrinsic value estimate of $15.31 from the DCF model and yielding a 42.13% margin of safety.

The share price declined 10% over the past year, determining a market capitalization of $411.19 million and a 52-week range of $6.19 to $10.01.

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GuruFocus has assigned a score of 5 out of 10 to the company's financial strength and 2 out of 10 to its profitability.

On Wall Street, the stock has one recommendation rating of buy and a target price of $16 per share.

Olympic Steel

The second stock that makes the cut is Olympic Steel Inc. (

ZEUS, Financial), a Bedford Heights, Ohio-based steel company.

The stock closed at $34.12 per share on Wednesday, below the intrinsic value of $142.56 from the DCF model and yielding a 75.01% margin of safety.

The share price increased by 39.52% over the past year, determining a market capitalization of $396.23 million and a 52-week range of $19.92 to $40.

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GuruFocus has assigned a score of 6 out of 10 to both 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 $40 per share.

Citi Trends

The third stock that qualifies is Citi Trends Inc. (

CTRN, Financial), a Savannah, Georgia-based fashion apparel, accessories and home goods retailer selling its products through more than 580 stores in urban and rural markets located in 33 states.

The stock was trading at $32.51 per share at close on Wednesday, below the intrinsic value of $91.88 from the DCF model and yielding a 64.23% margin of safety.

The share price has dropped 60.69% over the past year, determining a market capitalization of $258.12 million and a 52-week range of $31.42 to $111.44.

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GuruFocus has assigned a score of 6 out of 10 to the company's financial strength and 7 out of 10 to its profitability.

On Wall Street, the stock has a recommendation rating of buy and a target price of $63.33 per share.

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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