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After a great rally this week, it is much harder to find bargains than it was a few weeks ago. One stock that has sold off 25% over the last three months that looks significantly undervalued is Mosaic (NYSE:MOS).

7 reasons Mosaic is a solid bargain at $52:

1. It is selling near the bottom of the five year valuation range based on P/E, P/B, P/S and P/CF.

2. Mosaic has a forward PE of just over 9 which is an over 40% discount to its five year average.

3. MOS is a long term secular play on the growing demand for food in the emerging markets. The tailwind has helped propel 15% annual growth in EPS on average over the last five years.

4. The stock looks like it is trying to put in a short term technical bottom at $50 (See Chart).


(Click to enlarge)

5. The stock is starting to be accumulated by major hedge fund players like Cohen and Paulson.

6. Mosiac has a pristine balance sheet with over $7 a share in net cash on the books which is growing by the quarter.

7. It is way under analysts’ price targets. The median analysts’ price target on Mosiac is over $84 S&P is at $80 and Credit Suisse has a price target of $85 on MOS.

Source: Mosaic: 50 Percent Undervalued After A 25% Sell-Off