As of Tuesday, the GuruFocus All-in-One Screener found the following stocks that have low price-earnings ratios and have been bought by gurus. While some of them are great investments, others need to be checked again, according to the discounted cash flow calculator.
Discover Financial ServicesÂ
With a market cap of $25.12 billion, Discover Financial Services (DFS, Financial) is trading with a price-earnings ratio of 9.23. According to the DCF calculator, the stock has a fair value of $168.17 while trading at about $80. The price has risen 6% over the last 12 months and is now 15.10% below the 52-week high and 45.22% above the 52-week low.
The company, which operates in direct consumer banking services, has a GuruFocus profitability and growth rating of 5 out of 10. The return on equity of 25.38% and return on assets of 2.67% are outperforming 55% of companies in the Credit Services industry. Its financial strength is rated 2 out of 10. The cash-debt ratio of 0.41 is above the industry median of 0.19.
The company’s largest guru shareholder is PRIMECAP Management (Trades, Portfolio) with 3.89% of outstanding shares, followed by Diamond Hill Capital (Trades, Portfolio) with 1.27% and HOTCHKIS & WILEYÂ (Trades, Portfolio) with 1.22%.
HPĂ‚
With a $24.97 billion market cap, HP Inc. (HPQ, Financial) is trading with a price-earnings ratio of 6.22. According to the DCF calculator, the stock has a fair value of $29 while trading at $17. The share price has fallen 30% over the last 12 months.
GuruFocus gives the computer systems and printing supplies provider a profitability and growth rating of 7 out of 10. The return on assets of 12.72% is outperforming 92% of companies in the Computer Hardware industry. Its financial strength is rated 6 out of 10. The cash-debt ratio of 0.97 is below the industry median of 1.19.
Dodge & Cox (Trades, Portfolio) is the company’s largest guru shareholder with 7.77% of outstanding shares, followed by PRIMECAP Management with 0.97% and Pioneer Investments (Trades, Portfolio) with 0.15%.
Fortive
With a market cap of $23.8 billion, Fortive Corp. (FTV, Financial) is trading with a price-earnings ratio of 9.34 and a price-book ratio of 3.38. According to the DCF calculator, the stock has a fair value of $23.54 while trading at about $71. Shares have fallen 8.67% over the last 12 months and are now trading 20.72% below the 52-week high and 12.80% above the 52-week low.
GuruFocus gives the company a profitability and growth rating of 6 out of 10. The return on equity of 41.17% and return on assets of 19.02% are outperforming 97% of companies in the Computer Hardware industry. Its financial strength is rated 5 out of 10. The cash-debt ratio of 0.17 is below the industry median of 1.19.
The company’s largest guru shareholder is Pioneer Investments with 0.13% of outstanding shares, followed by Joel Greenblatt (Trades, Portfolio)’s Gotham Asset Management with 0.11%.
United Airlines
United Airlines Holdings Inc. (UAL, Financial) has a market cap of $22.80 billion and is trading with a price-earnings ratio of 8.34 and a price-book ratio of 2.04. According to the DCF calculator, the stock has a fair value of $115.58 while trading at $90.20. Shares were stable over the last 12 months and are currently trading 7.94% below the 52-week high and 16.96% above the 52-week low.
GuruFocus gives the company a profitability and growth rating of 8 out of 10. The return on equity of 27.87% and return on assets of 5.8% are outperforming 75% of companies in the Airlines industry. Its financial strength is rated 4 out of 10. The cash-debt ratio of 0.26 is below the industry median of 0.29.
With 14.09% of outstanding shares, PRIMECAP Management is the company’s largest guru shareholder, followed by Warren Buffett (Trades, Portfolio)’s Berkshire Hathaway with 8.13%, Diamond Hill Capital with 1.30% and Jim Simons (Trades, Portfolio)’ Renaissance Technologies with 0.67%.
Synchrony Financial
Synchrony Financial (SYF, Financial) has a market cap of $22.75 billion. Its shares are trading with a price-earnings ratio of 6.4 and a price-book ratio of 1.53. According to the DCF calculator, the stock has a fair value of $51.37 while trading at $34.80. Shares have risen 16.36% over a 12-month period and are currently trading 6.99% below the three-month high and 57.47% above the three-month low.
The American provider of private-label credit cards has a GuruFocus profitability and growth rating of 4 out of 10. The return on equity of 25.94% and return on assets of 3.59% are outperforming 61% of companies in the Credit Services industry. Its financial strength is rated 3 out of 10. The cash-debt ratio of 0.55 is above the industry median of 0.19.
The company’s largest guru shareholder is Warren Buffett with 3.14% of outstanding shares, followed by Seth Klarman (Trades, Portfolio)’s Baupost Group with 1.40% and First Eagle Investment (Trades, Portfolio) with 0.98%.
TD Ameritrade
TD Ameritrade Holding Corp. (AMTD, Financial) has a market cap of $20.18 billion. Its shares are trading with a price-earnings ratio of 10.17 and a price-book ratio of 2.52. According to the DCF calculator, the stock has a fair value of $45.12 while trading at $37. Shares have risen 26.92% over a 12-month period and are currently trading 36.44% below the 52-week high and 12.54% above the 52-week low.
The retail brokerage and advisor services firm has a GuruFocus profitability and growth rating of 5 out of 10. The return on equity of 25.69% and return on assets of 5.5% are outperforming 78% of companies in the Brokers and Exchanges industry. Its financial strength is rated 3 out of 10. The cash-debt ratio of 1.67 is below the industry median of 2.28.
The company’s largest guru shareholder is Chuck Akre (Trades, Portfolio) with 0.60% of outstanding shares, followed by the Simons’ firm with 0.29% and Ray Dalio (Trades, Portfolio)’s Bridgewater Associates with 0.04%.
Disclosure: I do not own any stocks mentioned.
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