5 Undervalued Stocks Growing Their Book Values

Grand Canyon Education tops the list

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Jul 29, 2019
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According to the GuruFocus All-in-One Screener, the following companies have grown their book value per share over the past decade.

Book value per share is calculated as total equity minus preferred stock, divided by shares outstanding. Theoretically, it is what shareholders will receive if a company is liquidated. Total equity is a balance sheet item and equal to total assets minus total liabilities. Since the book value per share may not reflect the company’s true value, some investors check the tangible book value to confirm their investment ideas.

The book value per share of Grand Canyon Education Inc. (LOPE, Financial) has grown 35.10% over the last 10 years. The price-book ratio is 4.84 and the price-tangible book value is 6.75.

The educational company, which owns private universities in the United States, has a $6.16 billion market cap.

According to the discounted cash flow calculator, the stock is undervalued with an 5.7% margin of safety at $127.67. The share price has been as high as $130.10 and as low as $90.67 in the last 52 weeks. As of Monday, the stock was trading 1.87% below its 52-week high and 40.80% above its 52-week low. The price-earnings ratio is 27.

Jim Simons (Trades, Portfolio)' Renaissance Technologies is the company's largest guru shareholder with 0.73% of outstanding shares, followed by Pioneer Investments (Trades, Portfolio) with 0.32%.

CSX Corp.’s (CSX, Financial) book value per share has grown 9.3% over the past decade. The price-book ratio and the price-tangible book value are both 4.59.

The railroad operator has a market cap of $55.06 billion and an enterprise value of $70.27 billion

According to the DCF calculator, the stock is undervalued with a 12.47% margin of safety at $69.63. The share price has been as high as $80.73 and as low as $58.47 in the last 52 weeks. As of Monday, the stock was trading 13.71% below its 52-week high and 19.14% above its 52-week low. The price-earnings ratio is 16.78.

With 0.99% of outstanding shares, Steve Mandel (Trades, Portfolio)’s Lone Pine Capital is the company's largest guru shareholder, followed by Pioneer Investments with 0.20% and PRIMECAP Management (Trades, Portfolio) with 0.15%

The book value per share of Credit Acceptance Corp. (CACC, Financial) has grown 23.50% over the last 10 years. The price-book ratio is 4.60, and the price to tangible book value is 4.59.

The consumer finance company has a market cap of $9.26 billion.

According to the DCF calculator, the stock is undervalued and is trading with a 45.90% margin of safety at $492.85. The share price has been as high as $509.99 and as low as $356.12 in the last 52 weeks. As of Monday, the stock was trading 3.36% below its 52-week high and 38.39% above its 52-week low. The price-earnings ratio is 15.42.

With 5.81% of outstanding shares, Ruane Cunniff (Trades, Portfolio) is the company's largest guru shareholder, followed by Jeremy Grantham (Trades, Portfolio)’s GMO with 0.29%.

Deckers Outdoor Corp.’s (DECK, Financial) book value per share has grown 8.60% over the past decade. The price-book ratio and the price to tangible book value are both 4.60.

The designer and seller of apparel and furniture has a market cap of $4.60 billion.

According to the DCF calculator, the stock is undervalued and is trading with a 50.48% margin of safety at $157.81. The share price has been as high as $180.76 and as low as $101.69 in the last 52 weeks. As of Monday, the stock was trading 12.64% below its 52-week high and 55.28% above its 52-week low. The price-earnings ratio is 16.94.

Simons’ firm is the company's largest guru shareholder with 2.33% of outstanding shares, followed by Lee Ainslie (Trades, Portfolio)’s Maverick Capital with 0.69% and Joel Greenblatt (Trades, Portfolio)’s Gotham Asset Management with 0.42%.

The book value per share of CarMax Inc. (KMX, Financial) has grown 9.5% over the last 10 years. The price-book ratio and the price to tangible book value are both 4.47.

The seller and marketer of new and used cars has a market cap of $15.18 billion.

According to the DCF calculator, the stock is undervalued and is trading with a 36.28% margin of safety at $91.84. The share price has been as high as $92.01 and as low as $55.24 in the last 52 weeks. As of Monday, the stock was trading 0.18% below its 52-week high and 66.27% above its 52-week low. The price-earnings ratio is 18.15.

With 7.22% of outstanding shares, PRIMECAP Management is the company's largest guru shareholder, followed by Cunniff with 6.89%.

Disclosure: I do not own any stocks mentioned.

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