3 stocks that trade below the pet
When looking for opportunities among growing companies, investors might be interested in the following stocks as their stock price is trading below their fair value Peter Lynch.
The measure, which is based on the idea that the fair price-earnings ratio for a growing company is on par with its growth rate, is derived from the combination of the following:
- The price-earnings / growth ratio of the stock.
- The share’s five-year EBITDA growth rate.
- Earnings per share of the stock without one-time items for the last 12 months up to the most recent quarter.
MDC Management Inc
The first stock that meets the criteria is MDC Holdings Inc (MDC, Financial), a Denver, Colorado-based homebuilding company with operations in the United States. The company also offers mortgage loans, insurance and reinsurance coverage on claim products as well as property and casualty insurance products.
On Friday, shares of MDC Holdings Inc closed at $ 46.34, below its fair value per Peter Lynch share of $ 179.75, for a fair value / Peter Lynch ratio of about 0.26. This ranks better than 80% of the 40 companies that operate in the home construction and construction industry.
The stock has a market cap of $ 3.27 billion after the stock price registered a 2.91% increase in the past year. The 52 week range is $ 38.14 to $ 63.86.
The stock has a median recommendation rating of overweighting on Wall Street. The average target price is $ 73.20 per share.
The second stock that makes the cut is Greif (FEM, Financial), a Delaware, Ohio-based manufacturer and seller of industrial packaging products and services to businesses around the world.
Greif’s share on Friday closed at $ 66.01, which is well below the fair value per Peter Lynch share of $ 106.53, resulting in a fair value / Peter Lynch ratio of approximately 0.62. This ranks better than 74% of the 95 companies that operate in the packaging and container industry.
The stock has a market cap of $ 3.18 billion following a 68.31% increase that occurred in the past year. The 52 week range is $ 37.89 to $ 68.81.
The stock has a median recommendation rating of overweighting on Wall Street and an average target price of $ 73.40 per share.
Genworth Financial Inc
The third qualifying security is Genworth Financial Inc (GNW, Financial), a Richmond, Virginia-based financial services company that provides its global clients with a variety of insurance solutions.
Shares of Genworth Financial Inc on Friday closed at $ 3.88, below its fair value per Peter Lynch share of $ 38.06, for a fair value / Peter Lynch ratio of about 0.10. This ranks higher than 98% of the 92 companies that operate in the insurance industry.
The stock has a market cap of $ 1.97 billion after rising nearly 12% in the past year. The 52 week range is $ 2.56 to $ 4.76.
The stock has a median conservation recommendation rating with an average target price of $ 2.50 per share on Wall Street.
Disclosure: I have no position on the titles mentioned.