6 Undervalued Large Caps With Bullish Options Sentiment

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 |  Includes: ACE, BRFS, C, EC, NTT, TSM
by: Kapitall

If you are looking to invest in large caps, you may find this article to be an interesting starting point for your own research.

To construct this list we looked for stocks with three characteristics:

  • Market cap greater than $10B
  • PEG below 1 (Price/Earnings To Growth ratio)
  • Put/Call ratio below or equal to 0.5

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 (NYSEARCA:SPY) index over the last month.

Considering these data points, which of these names would you rate as the best large-cap stock in this list?

1. Nippon Telegraph & Telephone Corp. (NYSE:NTT): Telecom Services Industry. Market cap of $63.38B. PEG at 0.58. The Put/Call ratio is 0.04, call open interest at 9,382 contracts vs. put open interest at 345 contracts. The stock has gained 20.17% over the last year.


2. Brasil Foods S.A. (NYSE:BRFS):
Meat Products Industry. Market cap of $13.76B. PEG at 0.54. The Put/Call ratio is 0.16, call open interest at 7,230 contracts vs. put open interest at 1,186 contracts. It's been a rough couple of days for the stock, losing 11.73% over the last week.

3. Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:TSM): Semiconductor Industry. Market cap of $69.07B. PEG at 0.81. The Put/Call ratio is 0.27, call open interest at 21,490 contracts vs. put open interest at 5,724 contracts. Offers a good dividend, and appears to have good liquidity to back it up--dividend yield at 3.5%, current ratio at 1.97, and quick ratio at 1.72. The stock has gained 29.8% over the last year.

4. Ecopetrol SA (NYSE:EC): Independent Oil & Gas Industry. Market cap of $90.68B. PEG at 0.85. The Put/Call ratio is 0.44, call open interest at 760 contracts vs. put open interest at 338 contracts. The stock has gained 61.19% over the last year.

5. Citigroup, Inc. (NYSE:C): Money Center Banks Industry. Market cap of $113.26B. PEG at 0.95. The Put/Call ratio is 0.49, call open interest at 2,821,791 contracts vs. put open interest at 1,385,540 contracts. This is a risky stock that is significantly more volatile than the overall market (beta = 2.53). The stock has lost 2.78% over the last year.

6. ACE Limited (NYSE:ACE): Property & Casualty Insurance Industry. Market cap of $22.18B. PEG at 0.82. The Put/Call ratio is 0.5, call open interest at 6,881 contracts vs. put open interest at 3,413 contracts. The stock has gained 28.52% over the last year.

*Data sourced from Schaeffer’s and Finviz.

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