Cummins and CSX: Undervalued With Predictable Business

Most of these businesses have high business predictability and low PE

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Feb 23, 2016
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According to GuruFocus’ All-in-One Screener, the following stocks have a high business predictability rating, and at least five gurus are shareholders in the companies.

Cabot Oil & Gas Corp. (COG)

GuruFocus gives the company a business predictability of 4 out of 5 stars. The company along with its subsidiaries is engaged in the development, exploitation, exploration, production and marketing of natural gas, crude oil and, to a lesser extent, NGLs within the continental U.S.

The stock is trading with a forward P/E ratio of 11.51, and the price has been as high as $35.64 and as low as $14.88 in the last 52 weeks. It is 39.56% below its 52-week high and 44.76% above its 52-week low.

Andreas Halvorsen (Trades, Portfolio) is the company's largest shareholder among the gurus with 7.45% of outstanding shares followed by Chris Davis (Trades, Portfolio) with 4.08%, Pioneer Investments (Trades, Portfolio) with 0.88%, PRIMECAP Management (Trades, Portfolio) with 0.66% and David Tepper (Trades, Portfolio) with 0.34%.

Essendant Inc. (ESND)

GuruFocus gives the company a business predictability of 4 out of 5 stars. It is a national wholesale distributor of business products including technology products, traditional office products, office furniture, janitorial and breakroom supplies and industrial supplies.

The stock is trading with a P/E ratio of 12.80, and the price has been as high as $43.11 and as low as $24.89 in the last 52 weeks. It is 35.05% below its 52-week high and 12.49% above its 52-week low. According to the DCF calculator, the company looks overpriced by 276%.

The company’s largest shareholder among the gurus is Richard Pzena (Trades, Portfolio) with 2.88% of outstanding shares followed by Steven Cohen (Trades, Portfolio) with 0.49%, James Barrow (Trades, Portfolio) with 0.34%, Jim Simons (Trades, Portfolio) with 0.22%, Scott Black (Trades, Portfolio) with 0.1%, Paul Tudor Jones (Trades, Portfolio) with 0.03% and Joel Greenblatt (Trades, Portfolio) with 0.02%.

Varian Medical Systems Inc. (VAR)

GuruFocus gives the company a business predictability of 4 out of 5 stars. It manufactures medical devices and software for treating cancer and other medical conditions with radiotherapy, radiosurgery, proton therapy and brachytherapy.

The stock is trading with a P/E ratio of 19.21, and the price has been as high as $96.67 and as low as $71.07 in the last 52 weeks. It is currently 18.55% below its 52-week high and 10.79% above its 52-week low. According to the DCF calculator, the company looks overpriced by 21%.

First Eagle Investment (Trades, Portfolio) is the company's largest shareholder among the gurus with 1.37% of outstanding shares followed by Westport Asset Management (Trades, Portfolio) with 0.29%, Simons with 0.2%, Charles Brandes (Trades, Portfolio) with 0.19%, CI Can Am Small Cap (Trades, Portfolio) with 0.06% and Ray Dalio (Trades, Portfolio) with 0.05%.

Jarden Corp. (JAH)

GuruFocus gives the company a business predictability of 4 out of 5 stars. The company is a provider of consumer products. It reports four business segments –Â Outdoor Solutions, Consumer Solutions, Branded Consumables and Process Solutions.

The stock is trading with a P/E ratio of 47.00, and the price has been as high as $57.97 and as low as $43.19 in the last 52 weeks. It is 9.18% below its 52-week high and 21.90% above its 52-week low. According to the DCF calculator, the company looks overpriced by 339%.

The company’s largest shareholder among the gurus is Diamond Hill Capital (Trades, Portfolio) with 1.78% of outstanding shares followed by Murray Stahl (Trades, Portfolio) with 1.4%, Eric Mindich (Trades, Portfolio) with 1.04%, Ken Fisher (Trades, Portfolio) with 0.85%, Lee Ainslie (Trades, Portfolio) with 0.8%, Larry Robbins (Trades, Portfolio) with 0.67%, Jeremy Grantham (Trades, Portfolio) with 0.23% and Jones with 0.1%.

Chevron Corp. (CVX)

GuruFocus gives the company a business predictability of 4 out of 5 stars. The company manages its investments in subsidiaries and affiliates and provides administrative, financial, management and technology support to U.S. and international subsidiaries that engage in fully integrated petroleum operations, chemicals operations, mining operations and power and energy services.

The stock is trading with a P/E ratio of 19.30, and the price has been as high as $112.20 and as low as $27.58 in the last 52 weeks. It is 20.84% below its 52-week high and 27.65% above its 52-week low. According to the DCF calculator, the company looks overpriced by 208%.

Barrow is the company's largest shareholder among the gurus, with 0.26% of outstanding shares followed by T Rowe Price Equity Income Fund (Trades, Portfolio) with 0.18%, Pioneer Investments (Trades, Portfolio) with 0.16%, Fisher with 0.15%, Grantham with 0.15% and Sarah Ketterer (Trades, Portfolio) with 0.08%.

Cummins Inc. (CMI)

GuruFocus gives the company a business predictability of 5 out of 5 stars. The company designs, manufactures, distributes and services diesel and natural gas engines and engine-related component products, including filtration, aftertreatment, turbochargers, fuel systems, controls systems, air handling systems and electric power generation systems.

The stock is trading with a P/E ratio of 12.58; the price has been as high as $146.13 and as low as $79.88 in the last 52 weeks. It is 32.57% below its 52-week high and 23.35% above its 52-week low. According to the DCF calculator, the company looks undervalued with a margin of safety of 34%.

The company’s largest shareholder among the gurus is HOTCHKIS & WILEY with 3.31% of outstanding shares followed by Bill Nygren (Trades, Portfolio) with 1.09%, First Eagle Investment (Trades, Portfolio) with 0.82%, T Rowe Price Equity Income Fund (Trades, Portfolio) with 0.44%, Pioneer Investments (Trades, Portfolio) with 0.43% and Greenblatt with 0.24%.

Exxon Mobil Corporation. (XOM)

GuruFocus gives the company a business predictability of 4 out of 5 stars. The company's main business is energy, involving exploration for, and production of, crude oil and natural gas, manufacture of petroleum products and transportation and sale of crude oil, natural gas and petroleum products.

The stock is trading with a P/E ratio of 17.37; the price has been as high as $90.09 and as low as $66.55 in the last 52 weeks. It is 8.55% below its 52-week high and 23.80% above its 52-week low. According to the DCF calculator, the company looks overpriced by 99%.

T Rowe Price Equity Income Fund (Trades, Portfolio) is the company's largest shareholder among the gurus with 0.16% of outstanding shares followed by Pzena with 0.15%, Fisher with 0.13%, Donald Yacktman (Trades, Portfolio) with 0.1%, Yacktman Fund (Trades, Portfolio) with 0.06%, Simons with 0.03% and Yacktman Focused Fund (Trades, Portfolio) with 0.03%.

Hubbell Inc. (HUBB)

GuruFocus gives the company a business predictability of 4 out of 5 stars. The company is engaged in the design, manufacture and sale of electrical and electronic products for nonresidential and residential construction, industrial and utility applications.

The stock is trading with a P/E ratio of 20.10; the price has been as high as $117.03 and as low as $80.33 in the last 52 weeks. It is 18.21% below its 52-week high and 19.16% above its 52-week low. According to the DCF calculator, the company looks overpriced by 59%.

The company’s largest shareholder among the gurus is Chuck Royce (Trades, Portfolio) with 1.94% of outstanding shares followed by Louis Moore Bacon (Trades, Portfolio) with 0.36%, Simons with 0.19%, Jones with 0.16%, Greenblatt with 0.1%, Cohen with 0.09% and Grantham with 0.08%.

CSX Corp. (CSX)

GuruFocus gives the company a business predictability of 4 out of 5 stars. The company is a transportation supplier, providing rail-based transportation services including traditional rail service and the transport of intermodal containers and trailers.

The stock is trading with a P/E ratio of 12.60, and the price has been as high as $37.67 and as low as $21.33 in the last 52 weeks. It is 32.84% below its 52-week high and 18.61% above its 52-week low. According to the DCF calculator, the company looks undervalued with a margin of safety of 28%.

PRIMECAP Management (Trades, Portfolio) is the company's largest shareholder among the gurus, with 0.47% of outstanding shares followed by First Eagle Investment (Trades, Portfolio) with 0.19%, Cohen with 0.17%, George Soros (Trades, Portfolio) with 0.08%, Steve Mandel (Trades, Portfolio) with 0.06%, Jones with 0.05%, Dalio with 0.02% and Tom Gayner (Trades, Portfolio) with 0.01%.