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Value investors seek to find stocks that they believe are trading below their fair value, with the assumption that they will soon rise to that fair value, generating a profit. If you consider yourself a value investor, you may be interested in this list.

We ran a screen on stocks trading near their 52-week highs for those also trading at the steepest discounts to their Graham numbers, potentially indicating that they are still undervalued.

The Graham Number was created by the "godfather of value investing" Benjamin Graham as a calculation for maximum fair value. It is based off of a stock's EPS and book value per share (BVPS).

Graham Number = SQRT(22.5 x TTM EPS x MRQ BVPS)

The equation assumes that P/E should not be higher than 15 and P/BV should not be higher than 1.5.

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

Do you think these stocks will break through to new highs? Use this list as a starting point for your own analysis.

List sorted by potential upside implied by the Graham equation.

1. First Interstate Bancsystem Inc. (FIBK): Operates as the bank holding company for First Interstate Bank that provides commercial and consumer banking services. Market cap of $600.43M. The stock is currently trading at 4.63% below its 52-week high. TTM Diluted EPS at $0.91, MRQ Book Value Per Share at $16.70, Graham number at $18.49 (vs. current price at $13.30, implies a potential upside of 39.03%). The stock has had a good month, gaining 19.81%.

2. Primerica, Inc. (PRI): Engages in the distribution of financial products on behalf of third parties to middle income households in the United States and Canada. Market cap of $1.82B. The stock is currently trading at 4.06% below its 52-week high. TTM Diluted EPS at $2.49, MRQ Book Value Per Share at $21.31, Graham number at $34.55 (vs. current price at $24.93, implies a potential upside of 38.60%). The stock has had a good month, gaining 15.08%.

3. ProAssurance Corporation (PRA): Provides professional liability insurance products primarily to physicians, dentists, other healthcare providers, and healthcare facilities in the United States. Market cap of $2.49B. The stock is currently trading at 0.51% below its 52-week high. TTM Diluted EPS at $8.03, MRQ Book Value Per Share at $66.23, Graham number at $109.39 (vs. current price at $79.97, implies a potential upside of 36.79%). The stock has gained 38.89% over the last year.

4. Annaly Capital Management, Inc. (NLY): Engages in the ownership, management, and financing of a portfolio of investment securities. Market cap of $16.05B. The stock is currently trading at 4.59% below its 52-week high. TTM Diluted EPS at $1.36, MRQ Book Value Per Share at $16.22, Graham number at $22.28 (vs. current price at $16.40, implies a potential upside of 35.84%). The stock has gained 8.03% over the last year.

5. Provident Financial Services, Inc. (PFS): Operates as the holding company for The Provident Bank that provides banking services to individuals, families, and businesses in New Jersey. Market cap of $865.99M. The stock is currently trading at 3.30% below its 52-week high. TTM Diluted EPS at $0.97, MRQ Book Value Per Share at $16.68, Graham number at $19.08 (vs. current price at $14.07, implies a potential upside of 35.61%). The stock has had a good month, gaining 13.9%.

6. Main Street Capital Corporation (MAIN): A business development company specializing in equity, equity related, and debt investments in small and lower middle market companies. Market cap of $571.80M. The stock is currently trading at 2.93% below its 52-week high. TTM Diluted EPS at $2.48, MRQ Book Value Per Share at $14.49, Graham number at $28.43 (vs. current price at $21.45, implies a potential upside of 32.56%). The stock has gained 30.49% over the last year.

7. Sempra Energy (SRE): Engages in the development of energy infrastructure, operation of utilities, and provision of energy-related products and services worldwide. Market cap of $13.50B. The stock is currently trading at 0.35% below its 52-week high. TTM Diluted EPS at $5.55, MRQ Book Value Per Share at $40.20, Graham number at $70.85 (vs. current price at $55.44, implies a potential upside of 27.80%). The stock has gained 11.73% over the last year.

8. IdaCorp, Inc. (IDA): Engages in the generation, transmission, distribution, sale, and purchase of electric energy in the United States. Market cap of $2.06B. The stock is currently trading at 3.50% below its 52-week high. TTM Diluted EPS at $3.60, MRQ Book Value Per Share at $33.29, Graham number at $51.93 (vs. current price at $41.61, implies a potential upside of 24.80%). The stock has gained 12.5% over the last year.

9. Portland General Electric Company (POR): Operates as an integrated electric utility in Oregon. Market cap of $1.86B. The stock is currently trading at 3.71% below its 52-week high. TTM Diluted EPS at $1.90, MRQ Book Value Per Share at $21.94, Graham number at $30.63 (vs. current price at $24.72, implies a potential upside of 23.89%). Offers a good dividend, and appears to have good liquidity to back it up--dividend yield at 4.3%, current ratio at 1.45, and quick ratio at 1.31. The stock has gained 16.97% over the last year.

10. American Electric Power Co., Inc. (AEP): Engages in the generation, transmission, and distribution of electric power to retail customers. Market cap of $19.80B. The stock is currently trading at 2.31% below its 52-week high. TTM Diluted EPS at $3.76, MRQ Book Value Per Share at $30.34, Graham number at $50.66 (vs. current price at $41.35, implies a potential upside of 22.52%). The stock has gained 18.22% over the last year.

11. W.R. Berkley Corporation (WRB): Operates as commercial lines writers in the property casualty insurance business primarily in the United States. Market cap of $4.78B. The stock is currently trading at 2.97% below its 52-week high. TTM Diluted EPS at $2.75, MRQ Book Value Per Share at $28.18, Graham number at $41.76 (vs. current price at $34.56, implies a potential upside of 20.82%). The stock has gained 27.65% over the last year.

12. 1st Source Corporation (SRCE): Operates as the holding company for 1st Source Bank that offers commercial and consumer banking services to individuals and businesses in Indiana and Michigan. Market cap of $607.43M. The stock is currently trading at 4.09% below its 52-week high. TTM Diluted EPS at $1.76, MRQ Book Value Per Share at $21.35, Graham number at $29.08 (vs. current price at $24.26, implies a potential upside of 19.85%). The stock has gained 39.62% over the last year.

13. Systemax Inc. (SYX): Operates as a direct marketer of brand name and private label products. Market cap of $629.55M. The stock is currently trading at 2.48% below its 52-week high. TTM Diluted EPS at $1.41, MRQ Book Value Per Share at $12.09, Graham number at $19.58 (vs. current price at $16.37, implies a potential upside of 19.64%). The stock is a short squeeze candidate, with a short float at 6.49% (equivalent to 23.54 days of average volume). The stock has gained 25.27% over the last year.

14. Edison International (EIX): Engages in the supply of electric energy in central, coastal, and southern California. Market cap of $13.19B. The stock is currently trading at 3.37% below its 52-week high. TTM Diluted EPS at $2.95, MRQ Book Value Per Share at $33.81, Graham number at $47.37 (vs. current price at $40.32, implies a potential upside of 17.49%). The stock has gained 11.05% over the last year.

15. DTE Energy Co. (DTE): Operates as an electric and natural gas utility company in Michigan. Market cap of $9.08B. The stock is currently trading at 2.98% below its 52-week high. TTM Diluted EPS at $4.20, MRQ Book Value Per Share at $41.18, Graham number at $62.38 (vs. current price at $53.29, implies a potential upside of 17.06%). The stock has gained 20.25% over the last year.

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

Source: 15 Stocks Trading Near Highs Undervalued By The Graham Number