6 Undervalued Stocks With Excellent Growth Prospects

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 |  Includes: AAPL, CCJ, CXO, ENDP, KSU, TTM
by: Kapitall

The following is a list of undervalued stocks, with Price to Earnings Growth (PEG) ratios below 1.

In addition, all of the names mentioned below have excellent growth prospects, with higher projected EPS growth rates than their industry competitors. All of the companies mentioned below also have the following characteristics:

  • EPS and revenue grew faster than their industry competitors over the last five years
  • Capital spending accelerated at a faster rate than their competitors (theoretically, this makes them more competitive over the coming years)
  • Cashflow growth has accelerated faster than their industry competitors over the last five years

We're not going to go into detailed analysis for each company. The goal here is to give growth-oriented investors a starting point for their own analysis.

All growth stats sourced from Fidelity, short float and performance data sourced from Finviz.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research. Note: The numbers on top of items represent the forward P/E ratio, if available.

The list has been sorted by the PEG ratio.

1. Concho Resources, Inc. (NYSE:CXO): Oil & Gas Drilling & Exploration Industry. Market cap of $9.12B. PEG ratio at 0.72. EPS has grown by 31.95% over the last five years vs. industry average at 3.22%. EPS projected to grow by 72.00% over the next five years vs. industry average at 10.95%. Revenue has grown by 58.20% over the last five years vs. industry average at 10.15%. Capital spending has grown by 62.37% over the last five years vs. industry average at 19.74%. The company's cash flow has grown by 71.52% over the last five years vs. industry average at 9.78%. Short float at 3.87%, which implies a short ratio of 3.6 days. The stock has gained 102.16% over the last year.

2. Tata Motors Ltd. (NYSE:TTM): Auto Manufacturer. Market cap of $15.06B. PEG ratio at 0.77. EPS has grown by 14.03% over the last five years vs. industry average at 2.91%. EPS projected to grow by 35.00% over the next five years vs. industry average at 15.88%. Revenue has grown by 35.97% over the last five years vs. industry average at 5.04%. Capital spending has grown by 33.17% over the last five years vs. industry average at 6.21%. The company's cash flow has grown by 30.47% over the last five years vs. industry average at 2.64%. Short float at 2.07%, which implies a short ratio of 2.15 days. The stock has gained 64.83% over the last year.

3. Cameco Corp. (NYSE:CCJ): Industrial Metals & Minerals Industry. Market cap of $15.33B. PEG ratio at 0.86. EPS has grown by 18.73% over the last five years vs. industry average at 3.22%. EPS projected to grow by 18.65% over the next five years vs. industry average at 10.95%. Revenue has grown by 20.28% over the last five years vs. industry average at 10.15%. Capital spending has grown by 24.73% over the last five years vs. industry average at 19.74%. The company's cash flow has grown by 18.92% over the last five years vs. industry average at 9.78%. Short float at 0.88%, which implies a short ratio of 1.41 days. The stock has gained 37.44% over the last year.

4. Apple Inc. (NASDAQ:AAPL): Personal Computers Industry. Market cap of $310.89B. PEG ratio at 0.93. EPS has grown by 57.56% over the last five years vs. industry average at 38.57%. EPS projected to grow by 20.70% over the next five years vs. industry average at 16.94%. Revenue has grown by 36.17% over the last five years vs. industry average at 22.83%. Capital spending has grown by 50.46% over the last five years vs. industry average at 29.02%. The company's cash flow has grown by 58.36% over the last five years vs. industry average at 36.41%. Short float at 0.74%, which implies a short ratio of 0.44 days. The stock has gained 66.17% over the last year.

5. Kansas City Southern (NYSE:KSU): Railroads Industry. Market cap of $4.93B. PEG ratio at 0.98. EPS has grown by 19.53% over the last five years vs. industry average at 14.17%. EPS projected to grow by 33.46% over the next five years vs. industry average at 15.29%. Revenue has grown by 18.28% over the last five years vs. industry average at 4.88%. Capital spending has grown by 24.40% over the last five years vs. industry average at 6.04%. The company's cash flow has grown by 26.31% over the last five years vs. industry average at 9.91%. Short float at 3.77%, which implies a short ratio of 3.82 days. The stock has gained 56.09% over the last year.

6. Endo Pharmaceuticals Holdings Inc. (NASDAQ:ENDP): Drug Manufacturers - Other Industry. Market cap of $3.92B. PEG ratio at 0.99. EPS has grown by 16.02% over the last five years vs. industry average at 9.08%. EPS projected to grow by 13.72% over the next five years vs. industry average at 5.93%. Revenue has grown by 18.89% over the last five years vs. industry average at 8.35%. Capital spending has grown by 5.18% over the last five years vs. industry average at 2.51%. The company's cash flow has grown by 17.63% over the last five years vs. industry average at 12.16%. Short float at 4.41%, which implies a short ratio of 3.86 days. The stock has gained 67.71% over the last year.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.