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In the search for potentially undervalued stocks, we ran a screen based on the theoretical assumption that if P/E is equal to a constant K, growth in EPS estimates should be matched by proportionate growth in price. When they don’t match up, a mispricing may have occurred.

We ran a screen on dividend stocks that appear undervalued by earnings growth, with PEG below 1, for those exhibiting this mismatch between changes in EPS estimate and price.

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 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think these stocks should be trading higher? Use this list as a starting-off point for your own analysis.

List sorted by dividend yield.

1. Brookfield Properties Corporation (NYSE:BPO): A publicly owned real estate investment firm. Market cap of $7.28B. Dividend yield at 3.88%, payout ratio at 14.79%. PEG at 0.81. Over the last 30 days, analyst projected EPS has increased 0.91% (from $1.10 to $1.11), while the price has decreased 2.54% (from $16.17 to $15.76). It's been a rough couple of days for the stock, losing 11.62% over the last week.

2. Bon-Ton Stores Inc. (NASDAQ:BONT): Operates department stores in the mid-size and metropolitan markets of the United States. Market cap of $104.16M. Dividend yield at 3.78%, payout ratio at 21.14%. PEG at 0.36. Over the last 30 days, analyst projected EPS has increased 1.52% (from $0.66 to $0.67), while the price has decreased 12.26% (from $6.85 to $6.01). This is a risky stock that is significantly more volatile than the overall market (beta = 2.77). The stock is a short squeeze candidate, with a short float at 15.95% (equivalent to 11.61 days of average volume). It's been a rough couple of days for the stock, losing 17.34% over the last week.

3. AFLAC Inc. (NYSE:AFL): Provides supplemental health and life insurance. Market cap of $14.96B. Dividend yield at 3.75%, payout ratio at 30.74%. PEG at 0.70. Over the last 30 days, analyst projected EPS has increased 0.32% (from $6.29 to $6.31), while the price has decreased 0.09% (from $34.88 to $34.85). The stock is currently stuck in a downtrend, trading 9.7% below its SMA20, 18% below its SMA50, and 34.85% below its SMA200. It's been a rough couple of days for the stock, losing 11.62% over the last week.

4. Cascade Corp. (NYSE:CASC): Manufactures loading devices and replacement parts primarily for the lift-truck and construction industry. Market cap of $362.54M. Dividend yield at 3.06%, payout ratio at 36.04%. PEG at 0.78. Over the last 30 days, analyst projected EPS has increased 4.35% (from $4.83 to $5.04), while the price has decreased 11.26% (from $37.64 to $33.40). It's been a rough couple of days for the stock, losing 9.16% over the last week.

5. BHP Billiton Ltd. (NYSE:BHP): Industrial Metals & Minerals Industry. Market cap of $179.08B. Dividend yield at 3.0%, payout ratio at 23.32%. PEG at 0.47. Over the last 30 days, analyst projected EPS has increased 13.49% (from $7.93 to $9.00), while the price has decreased 4.87% (from $77.76 to $73.97). It's been a rough couple of days for the stock, losing 14.6% over the last week.

6. Cliffs Natural Resources Inc. (NYSE:CLF): Produces iron ore pellets, lump and fines iron ore, and metallurgical coal products. Market cap of $8.06B. Dividend yield at 2.03%, payout ratio at 6.39%. PEG at 0.25. Over the last 30 days, analyst projected EPS has increased 0.22% (from $13.42 to $13.45), while the price has decreased 4.70% (from $68.12 to $64.92). This is a risky stock that is significantly more volatile than the overall market (beta = 2.37). It's been a rough couple of days for the stock, losing 30.57% over the last week.

*Projected EPS data and price data sourced from Yahoo! Finance, all other data sourced from Finviz.

Source: 6 Dividend Stocks Undervalued By PEG, EPS Trends