6 Stocks With Low Price-Sales Ratios

Johnson & Johnson tops the list

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Sep 12, 2019
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According to the GuruFocus All-in-One Screener as of Thursday, the following companies look cheap since they are trading with low price-sales ratios.

Johnson & Johnson (JNJ, Financial) is trading around $130 per share with a price-sales ratio of 4.35 and a price-earnings ratio of 21.75.

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The health care company, which operates in the pharmaceutical, medical devices and diagnostics areas, has a market cap of $345 billion. The stock has risen at an annualized rate of 10.20% over the past decade.

The discounted cash flow calculator gives the stock a fair value of $64.53, suggesting it is overpriced by 103%. The Peter Lynch value gives the stock a fair price of $90.45.

The company's largest guru shareholder is Ken Fisher (Trades, Portfolio) with 0.44% of outstanding shares, followed by Yacktman Asset Management (Trades, Portfolio) with 0.18% and Jim Simons (Trades, Portfolio)’ Renaissance Technologies with 0.16%.

Walmart Inc. (WMT, Financial) is trading around $116.72 per share with a price-sales ratio of 0.65 and price-earnings ratio of 26.13.

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The retail giant has a market cap of $329.99 billion. The stock has risen at an annualized rate of 10.20% over the last 10 years.

The DCF calculator gives the stock a fair value of $43.66, suggesting it is overpriced by 145%. The Peter Lynch value gives the stock a fair price of $47.52.

With 0.41% of outstanding shares, Bill Gates (Trades, Portfolio)’ foundation trust is the company's largest guru shareholder, followed by Fisher with 0.37% and Pioneer Investments (Trades, Portfolio) with 0.17%.

AT&T Inc. (T, Financial) is trading around $38.34 with a price-sales ratio of 1.54 and a price-earnings ratio of 16.28.

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The telecom company has a market cap of $283.07 billion. The stock has risen at an annualized rate of 7.94% over the past decade.

The DCF calculator gives the company a fair value of $26.46, suggesting it is overpriced by 44%. The Peter Lynch value gives the stock a fair price of $35.7.

The company's largest guru shareholder is Pioneer Investments with 0.33% of outstanding shares, followed by Barrow, Hanley, Mewhinney & Strauss with 0.08% and the T Rowe Price Equity Income Fund (Trades, Portfolio) with 0.04%.

Bank of America Corp. (BAC, Financial) is trading around $29.46 with a price-sales ratio of 1.15 and a price-earnings ratio of 10.52.

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The bank has a market cap of $274.22 billion. The stock has risen at an annualized rate of 6.42% over the last 10 years.

The DCF calculator gives the company a fair value of $29.96, suggesting it is overvalued by 1.67%. The Peter Lynch value gives the stock a fair price of $42.

The company's largest guru shareholder is Warren Buffett (Trades, Portfolio) with 9.96% of outstanding shares, followed by Dodge & Cox with 1.24% and PRIMECAP Management (Trades, Portfolio) with 0.39%.

The Home Depot Inc. (HD, Financial) is trading around $233.93 with a price-sales ratio of 2.36 and a price-earnings ratio of 23.17.

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The home improvement retailer has a market cap of $254.80 billion. The stock has risen at an annualized rate of 25.08% over the past decade.

The DCF calculator gives the company a fair value of $285.82, suggesting it is undervalued with an 18% of margin of safety. The Peter Lynch value gives the stock a fair price of $150.6.

The company's largest guru shareholder is Pioneer Investments with 0.54% of outstanding shares, followed by Fisher with 0.44% and Spiros Segalas (Trades, Portfolio) with 0.18%.

Verizon Communications Inc. (VZ, Financial) is trading around $60 with a price-sales ratio of 1.9 and a price-earnings ratio of 15.70.

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The telecom company has a market cap of $248.68 billion. The stock has risen at an annualized rate of 10.83% over the last 10 years.

The DCF calculator gives the company a fair value of $40.99, suggesting it is overpriced by 46%. The Peter Lynch value gives the stock a fair price of $57.45.

The company's largest guru shareholder is the T Rowe Price Equity Income Fund with 0.17% of outstanding shares, followed by Pioneer Investments with 0.14% and Barrow, Hanley, Mewhinney & Strauss with 0.07%.

Disclosure: I do not own any stocks mentioned.

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