6 Oversold Stocks With Potential To Pop And Good Long-Term Growth Prospects

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 |  Includes: BABY, BMY, CDR, OSK, QNST, SPTN, TEVA
by: Kinetic Investments

1. Cedar Realty (NYSE:CDR) is an integrated real estate investment trust, which focuses on ownership, operation, development and redevelopment of supermarket-anchored shopping centers in mid-Atlantic and northeast coastal states.

CDR Chart

The company currently ranks No. 1 when it comes to dividend yields among companies in the retail REITs industry. The stock trades below book value and WRT Realty recently reported a 7.6 stake in the company, citing that it "intends to consider appropriate methods of maximizing the value" of Cedar Realty's common stock.

The stock currently trades near $4.50, which is about 32% below its 52-week high of $6.58 and 25% below the highest sell side analyst's 52-week target of $6.

Valuation Metrics

Market Cap

306.08M

Enterprise Value

1.12B

PEG Ratio

6.60

Price/Sales

1.80

Price/Book

0.82

Enterprise Value/Revenue

7.04

Enterprise Value/EBITDA

12.70

Click to enlarge

Balance Sheet

Total Cash

11.64M

Total Cash Per Share

0.18

Total Debt

759.49M

Total Debt/Equity

133.40

Current Ratio

0.23

Book Value Per Share

5.23

Click to enlarge

2. Oshkosh Corporation (NYSE:OSK) is a designer, manufacturer and marketer of a range of vehicles and vehicle bodies.

OSK Chart

As I write, shares of Oshkosh have a forward P/E of 11.25%. Unfortunately, there's no dividend story here, but the company seems poised for growth and has recently received another order from the U.S. government worth $10.3M.

The stock currently trades near $22.75, which is about 43% below its 52-week high of $40.11 and 35% below the highest sell side analyst's 52-week target of $35.

Valuation Metrics

Market Cap

2.07B

Enterprise Value

2.59B

Forward P/E

11.25

PEG Ratio

4.67

Price/Sales

0.26

Price/Book

1.22

Enterprise Value/Revenue

0.34

Enterprise Value/EBITDA

3.99

Click to enlarge

Balance Sheet

Total Cash

428.50M

Total Cash Per Share

4.69

Total Debt

1.06B

Total Debt/Equity

66.53

Current Ratio

1.45

Book Value Per Share

17.48

Click to enlarge

3. Natus Medical Incorporated (NASDAQ:BABY) is a provider of healthcare products used for the screening, detection, treatment, monitoring and tracking of common medical ailments in newborn care, hearing impairment, neurological dysfunction, epilepsy, sleep disorders and balance and mobility disorders.

BABY Chart

No dividend to mention, but the stock currently trades right around its book value, is 87% institutionally owned and its debt to cash ratio looks good. It is coming off of a bad year and shows some promise for a 2012 rebound.

The stock currently trades near $22.75, which is about 43% below its 52-week high of $17.50 and 11% below the highest sell side analyst's 52-week target of $11.

Valuation Metrics

Market Cap

284.67M

Enterprise Value

242.01M

Forward P/E

16.05

PEG Ratio

0.90

Price/Sales

1.17

Price/Book

0.99

Enterprise Value/Revenue

1.04

Enterprise Value/EBITDA

8.81

Click to enlarge
Click to enlarge

Balance Sheet

Total Cash

30.78M

Total Cash Per Share

1.07

Total Debt

1.35M

Total Debt/Equity

0.49

Current Ratio

3.13

Book Value Per Share

9.55

Click to enlarge

4. Teva Pharmaceutical Industries Limited (NYSE:TEVA) is a global pharmaceutical and drug company.

TEVA Chart

The company very recently announced that Shlomo Yanai, the president and CEO of the company, will be retiring in May and that the board of directors has tapped Dr. Jeremy Levin, a former executive at Bristol-Myers Squibb (NYSE:BMY), to succeed him. Over the course of five years, Yanai has transformed the company from an $8B-a-year generics manufacturer to a roughly $20B-a-year, diversified and globalized big pharma company. It is coming of a relatively disappointing year, but pays a respectable dividend and has a levered free cash flow of $2.21B.

The stock currently trades near $42.50, which is about 25% below its 52-week high of $57.08 and 36% below the highest sell side analyst's 52 week target of $67.

Valuation Metrics

Market Cap

37.65B

Enterprise Value

42.77B

Forward P/E

7.58

PEG Ratio

0.86

Price/Sales

2.09

Price/Book

1.56

Enterprise Value/Revenue

2.51

Enterprise Value/EBITDA

8.43

Click to enlarge

Balance Sheet

Total Cash

1.12B

Total Cash Per Share

1.27

Total Debt

8.18B

Total Debt/Equity

35.66

Current Ratio

1.13

Book Value Per Share

25.83

Click to enlarge

5. QuinStreet, Inc. (NASDAQ:QNST) is a company that is engaged in vertical marketing and media on the Internet. It operates in two segments: Direct Marketing Services and Direct Selling Services.

QNST Chart

While short interest represents about 7% of its total outstanding shares, making it the seventh highest shorted stock in its market segment, and from its most recent filing, both earnings and revenue growth are down a bit from the same period last year, the possibility for things to turn around this year are very real, as Quinstreet recently partnered with Hanley Wood, LLC to launch ProConnect, a service that is designed to match residential contractors with potentially millions of homeowners on an annual basis.

The stock currently trades near $10, which is about 60% below its 52-week high of $24.91 and 58% below the highest sell side analyst's 52-week target of $24.

Valuation Metrics

Market Cap

469.26M

Enterprise Value

404.43M

Forward P/E

9.87

PEG Ratio

0.72

Price/Sales

1.11

Price/Book

1.22

Enterprise Value/Revenue

1.01

Enterprise Value/EBITDA

5.67

Click to enlarge

Balance Sheet

Total Cash

145.30M

Total Cash Per Share

3.05

Total Debt

103.80M

Total Debt/Equity

28.37

Current Ratio

2.97

Book Value Per Share

7.69

Click to enlarge

6. Spartan Stores, Inc. (NASDAQ:SPTN) is a regional grocery distributor and grocery retailer that operates mainly in Michigan and Indiana. It operates in two business segments: Distribution and Retail.

SPTN Chart

The stock sports an impressive dividend yield (for its market segment) of 1.5%. In the food distributors industry, Spartan ranks among the highest in terms of free cash-flow per share, highest future earnings growth potential and highest gross margin.

The stock currently trades near $19, which is about 11% below its 52 week high of $21.37 and 17% below the highest sell side analyst's 52 week target of $23.

Valuation Metrics

Market Cap

434.42M

Enterprise Value

539.47M

Forward P/E

12.97

PEG Ratio

1.32

Price/Sales

0.16

Price/Book

1.32

Enterprise Value/Revenue

0.21

Enterprise Value/EBITDA

5.32

Click to enlarge

Balance Sheet

Total Cash

62.08M

Total Cash Per Share

2.72

Total Debt

178.56M

Total Debt/Equity

55.55

Current Ratio

1.38

Book Value Per Share

14.06

Click to enlarge

All of the above listed names performed well on the first trading day of the year, but I suspect there will be better buying opportunities in the days to come. I would consider them all potentially good-to-great short term plays, as well as longer-term investments.

Disclosure: I am long BMY, QNST, SPTN.