5 Companies Growing Earnings

IBM tops the list

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Sep 12, 2019
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According to the GuruFocus All-in-One Screener, the following companies are trading at a discount and have positive three- to five-year future earnings estimates.

Shares of International Business Machines Corp. (IBM, Financial) are trading around $143 per share. The discounted cash flow calculator gives the stock a fair value of $103.59 per share, suggesting it is overpriced by 38.62%.

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The tech company, which provides a range of services as well as software and hardware, has a GuruFocus profitability and growth rating of 7 out of 10. Analysts project a three-year to five-year earnings growth rate of 6.83%. While the return on equity of 48.94% is outperforming the sector, the return on assets of 6.69% is underperforming 53% of companies in the application software industry.

With 0.25% of outstanding shares, Pioneer Investments (Trades, Portfolio) is the company's largest guru shareholder, followed by Jim Simons (Trades, Portfolio)’ Renaissance Technologies with 0.14% and Barrow, Hanley, Mewhinney & Strauss with 0.12%.

Novo Nordisk A/S (NVO, Financial) is trading around $50.40 per share. The DCF calculator gives the stock a fair value of $64.11 per share, suggesting it has a 20.70% margin of safety.

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The company, which provides diabetes care products, has a GuruFocus profitability and growth rating of 8 out of 10. Its earnings per share have grown 12.20% over the last five years. Analysts project a three-year to five-year earnings growth rate of 8.02%. The return on equity of 75.5% and return on assets of 34.54% are outperforming 91% of companies in the biotechnology industry.

Simons’ firm is the company's largest guru shareholder with 0.95% of outstanding shares, followed by Ken Fisher (Trades, Portfolio) with 0.63%, Pioneer Investments with 0.08% and Tom Gayner (Trades, Portfolio) with 0.05%.

Union Pacific Corp. (UNP, Financial) is trading around $167.3 per share. The DCF calculator gives the stock a fair value of $196.57 per share, suggesting it has a 14.60% margin of safety.

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The railroad company has a GuruFocus profitability and growth rating of 7 out of 10. Its earnings per share have risen 15.50% over the last five years. Analysts project a three-year to five-year earnings growth rate of 12.23%. The return on equity of 31.52% and return on assets of 10.17% are outperforming 85% of the companies in the transportation and logistics industry.

With 0.68% of outstanding shares, Steve Mandel (Trades, Portfolio) is the company's largest guru shareholder, followed by First Eagle Investment (Trades, Portfolio) with 0.48% and Spiros Segalas (Trades, Portfolio) with 0.39%.

Gilead Sciences Inc. (GILD, Financial) is trading around $67.45 per share. The DCF calculator gives the stock a fair value of $131.24 per share, suggesting it is undervalued with a 48.61% margin of safety.

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The company, which develops and markets therapies to treat life-threatening diseases and infections, has a GuruFocus profitability and growth rating of 9 out of 10. Its earnings per share have grown 5.20% over the last five years. Analysts project a three-year to five-year earnings growth rate of 16.21%. The return on equity of 26.95% and return on assets of 9.32% are outperforming 60% of companies in the Drug Manufacturers industry.

With 1.36% of outstanding shares, Dodge & Cox is the company's largest guru shareholder, followed by Simons’ firm with 01.01% and the T Rowe Price Equity Income Fund (Trades, Portfolio) with 0.28%.

Itau Unibanco Holding SA (ITUB, Financial) is trading around $8.65 per share. The DCF calculator gives the stock a fair value of $11.21 per share, suggesting it is undervalued with a 22.84% margin of safety.

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The Brazilian bank has a GuruFocus profitability and growth rating of 4 out of 10. Its earnings per share have grown 6.70% over the last five years. Analysts project a three-year to five-year earnings growth rate of 16.90%. While the return on equity of 17.56% is outperforming the sector, the return on assets of 1.7% is underperforming 59% of companies in the banks industry.

With 0.45% of outstanding shares, Fisher is the company's largest guru shareholder, followed by Ken Heebner (Trades, Portfolio) with 0.14% and Howard Marks (Trades, Portfolio) with 0.12%.

Disclosure: I do not own any stocks mentioned.

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