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Guru Stocks With Wide Margin of Safety

Undervalued stocks according to the DCF calculator

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Jun 13, 2016
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The following stocks are trading with wide margins of safety, according to the DCF calculator, and some of them have very low P/E ratios. GuruFocus' All-in-One Screener can be used to find similar stocks.

Discover Financial Services (DFS) has a market cap of $23.21 billion and a GuruFocus business predictability of 5/5 stars. The stock has a price of $56.3 with a P/E ratio of 10.83 and according to the DCF calculator is trading with a margin of safety of 54%, since its fair value is $122.2. During the last 12 months the price of the stock has dropped by 3% and is now 5.98% below its 52-week high.

The company offers credit card loans, private student loans, personal loans, home equity loans and deposit products. Its profitability & growth is rated 8/10 with ROE of 19.83% and ROA of 2.66% that are ranked higher than 53% of other companies in the Global Credit Services industry.

The largest shareholder among the gurus is Barrow, Hanley, Mewhinney & Strauss with 1.2% of outstanding shares followed by

PRIMECAP Management (Trades, Portfolio) with 0.69%, NWQ Managers (Trades, Portfolio) with 0.54%, Pioneer Investments (Trades, Portfolio) with 0.07%, John Keeley (Trades, Portfolio) with 0.02% and Diamond Hill Capital (Trades, Portfolio) with 0.01%.

Bed Bath & Beyond Inc. (BBBY) has a market cap of $6.78 billion and a GuruFocus business predictability of 4/5 stars. The stock has a price of $43.53 with a P/E ratio of 8.47 and according to the DCF calculator is trading with a margin of safety of 53%, since its fair value is $92.82. During the last 12 months the price of the stock has dropped by 37% and is now 39.27% below its 52-week high.

The company operates a chain of retail stores under the names Bed Bath & Beyond, Christmas Tree Shops, Harmon and Harmon Face Values, buybuy BABY & World Market or Cost Plus World Market.

Its profitability & growth is rated 8/10 with ROE of 32.39% and ROA of 12.62% that are ranked higher than 89% of other companies in the Global Specialty Retail industry.

HOTCHKIS & WILEY is the largest shareholder of the company among the gurus, with 4.87% of outstanding shares followed by

PRIMECAP Management (Trades, Portfolio) with 2.71%, Jeremy Grantham (Trades, Portfolio) with 1.12%, Chuck Royce (Trades, Portfolio) with 0.99% and Ray Dalio (Trades, Portfolio) with 0.3%.

Polaris Industries Inc. (PII) has a market cap of $5.26 billion and a GuruFocus’ business predictability of 2.5/5 stars. The stock has a price of $81.32 with a P/E ratio of 13.20 and according to the DCF calculator is trading with a margin of safety of 53%, since its fair value is $171.92. During the last 12 months the price of the stock has dropped by 44% and is now 47.99% below its 52-week high.

The company designs, engineers and manufactures off-road vehicles, which includes all terrain vehicles and side-by-side vehicles for recreational and utility use, snowmobiles and motorcycles.

Its profitability & growth is rated 7/10 with ROE 45.0% and ROA of 18.24% that are ranked higher than 96% of other companies in the Global Recreational Vehicles industry.

The largest shareholder among the gurus is

Columbia Wanger (Trades, Portfolio) with 1.93% of outstanding shares followed by Ken Fisher (Trades, Portfolio) with 0.35%, Meridian Funds (Trades, Portfolio) with 0.23% and Mairs and Power (Trades, Portfolio) with 0.01%.

Celadon Group Inc. (CGI) has a market cap of $282.19 million. The stock has a price of $10 with a P/E ratio of 7.63 and according to the DCF calculator is trading with a margin of safety of 52%, since its fair value is $21.03. During the last 12 months the price of the stock has risen by 57% and is now 57.34% below its 52-week high.

The company through its subsidiaries provides truckload transportation services between U.S., Canada and Mexico. It offers services such as long-haul, regional, dedicated, less-than-truckload, intermodal and logistics services.

Its profitability & growth is rated 6/10 with ROE of 10.04% and ROA of 3.07% that are ranked higher than 51% of other companies in the Global Trucking industry.

Jim Simons (Trades, Portfolio) is the largest shareholder of the company among the gurus, with 0.36% of outstanding shares followed by Paul Tudor Jones (Trades, Portfolio) with 0.14%.

Silicom Ltd. (SILC) has a market cap of $207.721.28 million and a GuruFocus business predictability of 4.5/5 stars. The stock has a price of $28.41 with a P/E ratio of 13.53 and according to the DCF calculator is trading with a margin of safety of 52%, since its fair value is $59.78. During the last 12 months the price of the stock has dropped by 26% and is now 31.43% below its 52-week high.

The company is engaged in the design, manufacture, marketing and support of high performance networking and data infrastructure solutions for servers, server based systems and communications devices.

Its profitability & growth is rated 8/10 with ROE of 14.27% and ROA of 11.67% that are ranked higher than 80% of other companies in the Global Communication Equipment industry.

Energy Company of Parana. (ELP) has a market cap of $2.02 billion. The stock has a price of $7.39 with a P/E ratio of 5.15 and according to the DCF calculator is trading with a margin of safety of 23%, since its fair value is $9.62. During the last 12 months the price of the stock has dropped by 29% and is now 36.13% below its 52-week high.

The company is engaged in the generation, transmission, distribution and sale of electricity mainly in the Brazilian State of Paraná. It also provides telecommunications and other services.

Its profitability & growth is rated 7/10 with ROE of 6.6% that is ranked under than 61% and ROA of 3.27% that is ranked higher than 56% of other companies in the Global Utilities - Diversified industry.

Charles Brandes (Trades, Portfolio) is the largest shareholder of the company among the gurus, with 2.01% of outstanding shares followed by Jeremy Grantham (Trades, Portfolio) with 0.84%, RS Investment Management (Trades, Portfolio) with 0.25% and Jim Simons (Trades, Portfolio) with 0.01%.

Agrium Inc. (AGU) has a market cap of $12.98 billion and a GuruFocus’ business predictability of 3.5/5 stars. The stock has a price of $93.92 with a P/E ratio of 13.62 and according to the DCF calculator is trading with a margin of safety of 52%, since its fair value is $196.15. During the last 12 months the price of the stock has dropped by 10% and is now 14.20% below its 52-week high.

The company is a retail supplier of agricultural products and services in North and South America and producer and marketer of agricultural nutrients and industrial products.

Its profitability & growth is rated 8/10 with ROE of 15.37% and ROA of 5.60% that are ranked higher than 64% of other companies in the Global Agricultural Inputs industry.

The largest shareholder among the gurus is Jeff Ubben (Trades, Portfolio) 2.29% of outstanding shares followed by Dodge & Cox with 2.01%,

NWQ Managers (Trades, Portfolio) with 0.7%, Jim Simons (Trades, Portfolio) with 0.13%, Joel Greenblatt (Trades, Portfolio) with 0.12%, Jeremy Grantham (Trades, Portfolio) with 0.1%, Ray Dalio (Trades, Portfolio) with 0.08%, Westport Asset Management (Trades, Portfolio) with 0.08% and John Buckingham (Trades, Portfolio) with 0.01%.

ICICI Bank Ltd. (IBN) has a market cap of $21.43 billion. The stock has a price of $7.38 with a P/E ratio of 14.53 and according to the DCF calculator is trading with a margin of safety of 51%, since its fair value is $15.11. During the last 12 months the price of the stock has dropped by 24% and is now 30.51% below its 52-week high.

The company is a banking company engaged in providing banking and financial services including retail banking, corporate banking and treasury operations.

Its profitability & growth is rated 6/10 with ROE of 60.09% and ROA of 6.16% that are ranked higher than 98% of other companies in the Global Banks - Regional - Asia industry.

Ken Fisher (Trades, Portfolio) is the largest shareholder of the company among the gurus, with 0.43% of outstanding shares followed by Jim Simons (Trades, Portfolio) with 0.21%, Sarah Ketterer (Trades, Portfolio) with 0.21%, Howard Marks (Trades, Portfolio) with 0.14%, Jeremy Grantham (Trades, Portfolio) with 0.13% and Prem Watsa (Trades, Portfolio) with 0.05%.

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