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Are you a value investor, always looking for potentially undervalued names? We ran a screen with that idea in mind.

We began by screening the industrial goods sector for stocks that appear undervalued relative to earnings growth, with PEG below 1.

We then screened for those that also appear undervalued relative to the Graham Number. The Graham Number is a measure of maximum fair value created by the "godfather of value investing" Benjamin Graham.

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. Stocks trading well below their Graham Number may be undervalued.

For an interactive version of this chart, click on the image below. Analyst ratings sourced from Zacks Investment Research.

Tool provided by Kapitall (kapitall.com).

Do you think these stocks have more value to price in? Use this list as a starting point for your own analysis.

List sorted by potential upside implied by the Graham Number.

1. Orbital Sciences Corp. (ORB): Develops and manufactures small and medium-class rockets and space systems for commercial, military, and civil government customers. Market cap at $720.86M, most recent closing price at $12.22. PEG at 0.88. Diluted TTM earnings per share at 1.14, and a MRQ book value per share value at 11.17, implies a Graham Number fair value = sqrt(22.5*1.14*11.17) = $16.93. Based on the stock's price at $12.29, this implies a potential upside of 37.73% from current levels.

2. Kennametal Inc. (KMT): Manufactures and supplies tooling, engineered components, and advanced materials consumed in production processes worldwide. Market cap at $2.59B, most recent closing price at $32.31. PEG at 0.6. Diluted TTM earnings per share at 3.76, and a MRQ book value per share value at 21.48, implies a Graham Number fair value = sqrt(22.5*3.76*21.48) = $42.63. Based on the stock's price at $31.57, this implies a potential upside of 35.03% from current levels.

3. Culp Inc. (CFI): Culp, Inc. manufactures, sources, and markets mattress fabrics and upholstery fabrics to the furniture and bedding industries in North America and internationally. Market cap at $122.71M, most recent closing price at $9.67. PEG at 0.42. Diluted TTM earnings per share at 1.03, and a MRQ book value per share value at 7.01, implies a Graham Number fair value = sqrt(22.5*1.03*7.01) = $12.75. Based on the stock's price at $9.63, this implies a potential upside of 32.36% from current levels.

4. Cascade Corp. (CASC): Cascade Corp. manufactures loading devices and replacement parts primarily for the lift-truck and construction industry. Market cap at $498.5M, most recent closing price at $44.95. PEG at 0.79. Diluted TTM earnings per share at 5.46, and a MRQ book value per share value at 29.21, implies a Graham Number fair value = sqrt(22.5*5.46*29.21) = $59.90. Based on the stock's price at $45.32, this implies a potential upside of 32.18% from current levels.

5. AO Smith Corp. (AOS): Engages in the manufacture and sale of water heating equipment to the residential and commercial markets in the United States and internationally. Market cap at $2.21B, most recent closing price at $47.60. PEG at 0.83. Diluted TTM earnings per share at 6.71, and a MRQ book value per share value at 24.61, implies a Graham Number fair value = sqrt(22.5*6.71*24.61) = $60.95. Based on the stock's price at $47.81, this implies a potential upside of 27.49% from current levels.

6. Triumph Group, Inc. (TGI): Engages in the design, engineering, manufacture, repair, overhaul, and distribution of aircraft components. Market cap at $2.85B, most recent closing price at $57.22. PEG at 0.79. Diluted TTM earnings per share at 5.42, and a MRQ book value per share value at 36.47, implies a Graham Number fair value = sqrt(22.5*5.42*36.47) = $66.69. Based on the stock's price at $55.18, this implies a potential upside of 20.86% from current levels.

7. LSB Industries Inc. (LXU): Engages in the manufacture and sale of geothermal and water source heat pumps, air handling products, and chemical products. Market cap at $594.69M, most recent closing price at $26.62. PEG at 0.85. Diluted TTM earnings per share at 3.29, and a MRQ book value per share value at 13.66, implies a Graham Number fair value = sqrt(22.5*3.29*13.66) = $31.80. Based on the stock's price at $27.18, this implies a potential upside of 16.99% from current levels.

8. EnerSys (ENS): Engages in the manufacture and sale of industrial batteries. Market cap at $1.55B, most recent closing price at $32.27. PEG at 0.89. Diluted TTM earnings per share at 2.93, and a MRQ book value per share value at 21.59, implies a Graham Number fair value = sqrt(22.5*2.93*21.59) = $37.73. Based on the stock's price at $32.5, this implies a potential upside of 16.08% from current levels.

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

Source: 8 Industrial Goods Stocks Undervalued By Earnings Growth, The Graham Number