7 Stocks With Rising Prices and Margins of Safety

Using Peter Lynch Value to select undervalued stocks

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May 17, 2017
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According to the GuruFocus All-in-One Screener, several gurus are focusing on stocks whose Peter Lynch fair values are far above the current prices. The following stocks are trading with wide margins of safety and have positive performances over the past 12 months.

Wipro Ltd. ADRĂ‚ (WIT) is trading around $10.27 per share. The Peter Lynch Value gives the stock a fair price of $16.07 so the stock is undervalued with a margin of safety of 36%. The stock started its positive upward trend 12 weeks ago; it now registers a positive performance of 6.8%.

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Wipro is an IT services company. Its IT Services businesses provide IT and IT-enabled services which include IT consulting, custom application design, development, re-engineering and maintenance, systems integration and package implementation among others.

The stock is trading with a price-earnings (P/E) ratio of 14.64, which is higher than 76% of the companies in the Global Information Technology Services industry. The price is 17.64% below its 52-week high and 14.11% above its 52-week low. The price-book (P/B) ratio is 2.36.

Ken Fisher (Trades, Portfolio) with 0.08% of outstanding shares is the largest investor among the gurus followed by Jim Simons (Trades, Portfolio) with 0.06% and Jeremy Grantham (Trades, Portfolio) with 0.01%.

ILG Inc. (ILG) is trading around $26 per share. The Peter Lynch Value gives the stock a fair price of $33.17 so the stock is undervalued with a margin of safety of 22%. The stock started its positive upward 12 weeks ago; it now registers a positive performance of 35.1%.

ILG is a provider of professionally delivered vacation experiences and the exclusive global licensee for the Hyatt, Sheraton and Westin brands in vacation ownership.

The stock is trading with a P/E ratio of 10.24 which is higher than 84% of the companies in the Global Leisure industry. The price is 0.95% below its 52-week high and 120.53% above its 52-week low. The P/B ratio is 2.03.

The largest shareholder among the gurus is Wallace Weitz (Trades, Portfolio) with 1.79% followed by Steven Cohen (Trades, Portfolio) with 4.19%, Simons with 0.16%, Joel Greenblatt (Trades, Portfolio) with 0.11%, Mario Gabelli (Trades, Portfolio) with 0.03% and David Dreman (Trades, Portfolio) with 0.02%.

Akorn Inc. (AKRX) is trading around $33.19 per share. The Peter Lynch Value gives the stock a fair price of $36.75 so the stock is undervalued with a margin of safety of 10%. The stock started its positive upward 12 weeks ago; it now registers a positive performance of 51%.

Akorn is a generic pharmaceutical company that develops, manufactures and markets generic and branded prescription pharmaceuticals and branded as well as private-label over-the-counter consumer health products and animal health pharmaceuticals.

The stock is trading with a P/E ratio of 22.59, which is higher than 79% of the companies in the Global Drug Manufacturers - Specialty and Generic industry. The price is 6.24% below its 52-week high and 88.47% above its 52-week low. The P/B ratio is 4.76.

The largest shareholder among the gurus is John Paulson (Trades, Portfolio) with 6.74% followed by Columbia Wanger (Trades, Portfolio) with 2.15%, First Pacific Advisors (Trades, Portfolio) with 0.62%, FPA Capital Fund (Trades, Portfolio) with 0.31%, Richard Snow (Trades, Portfolio) with 0.23%, Robert Olstein (Trades, Portfolio) with 0.18%, Lee Ainslie (Trades, Portfolio) with 0.11%, Gabelli with 0.05%, Greenblatt with 0.05% and Dreman with 0.01%.

Gildan Activewear Inc. Class AĂ‚ (GIL) is trading around $28.39 per share. The Peter Lynch Value gives the stock a fair price of $36.96 so the stock is undervalued with a margin of safety of 23%. The stock started its positive upward 12 weeks ago; it now registers a positive performance of 13.8%.

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Gildan Activewear is an apparel manufacturer in North America. Its suite of products includes T-shirts, fleece, socks and underwear. It has markets in the U.S., Canada and other regions of the world.

The stock is trading with a P/E ratio of 19.17, which is higher than 50% of the companies in the Global Apparel Manufacturing industry. The price is 11.83% below its 52-week high and 20.55% above its 52-week low. The P/B ratio is 3.26.

PRIMECAP Management (Trades, Portfolio) with 1.04% of outstanding shares is the largest investor among the gurus followed by Private Capital (Trades, Portfolio) with 0.37%, Sarah Ketterer (Trades, Portfolio) with 0.14%, Simons with 0.06%, Greenblatt with 0.03% and Chuck Royce (Trades, Portfolio) with 0.02%.

Noah Holdings Ltd. ADRĂ‚ (NOAH) is trading around $26.09 per share. The Peter Lynch Value gives the stock a fair price of $40.47 so the stock is undervalued with a margin of safety of 36%. The stock started its positive upward 12 weeks ago; it now registers a positive performance of 5.6%.

Noah Holdings is a wealth management service provider with a focus on global wealth investment and asset allocation services for the high net worth population in the People's Republic of China.

The stock is trading with a P/E ratio of 16.08, which is lower than 58% of the companies in the Global Asset Management industry. The price is 12.24% below its 52-week high and 22.32% above its 52-week low. The P/B ratio is 3.05.

The largest shareholder among the gurus is Chris Davis (Trades, Portfolio) with 2.24% of outstanding shares.

KB Home (KBH) is trading around $21.29 per share. The Peter Lynch Value gives the stock a fair price of $44.25 so the stock is undervalued with a margin of safety of 52%. The stock started its positive upward 12 weeks ago; it now registers a positive performance of 27.9%.

KB Home is engaged in the construction and sale of homes. The company offers a variety of new homes designed for first-time, move-up and active adult homebuyers including attached and detached single-family residential homes.

The stock is trading with a P/E ratio of 18.67 which is lower than 58% of the companies in the Global Residential Construction industry. The price is 0.28% below its 52-week high and 71.97% above its 52-week low. The P/B ratio is 1.03.

Donald Smith (Trades, Portfolio) with 8.13% of outstanding shares is the largest investor among the gurus followed by Fisher with 4.18%, John Hussman (Trades, Portfolio) with 0.24%, Caxton Associates (Trades, Portfolio) with 0.02%, Paul Tudor Jones (Trades, Portfolio) with 0.02% and Grantham with 0.01%.

American Outdoor Brands Corp. (AOBC) is trading around $22.65 per share. The Peter Lynch Value gives the stock a fair price of $58.5 so the stock is undervalued with a margin of safety of 61%. The stock started its positive upward 12 weeks ago; it now registers a positive performance of 20.2%.

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American Outdoor Brands manufactures firearms. It manufactures handguns, modern sporting rifles, hunting rifles, black powder firearms, handcuffs, and firearm-related products and accessories.

The stock is trading with a P/E ratio of 9.68, which is higher than 89% of the companies in the Global Aerospace & Defense industry. The price is 27.38% below its 52-week high and 29.43% above its 52-week low. The P/B ratio is 3.11.

The largest shareholder among the gurus is Cohen with 0.71% followed by Royce with 0.44%, Dreman with 0.03%, Greenblatt with 0.03% and Jones with 0.02%.

Disclosure: I do not own any shares of any stocks mentioned in this article.

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