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We screened the consumer goods sector for stocks that appear undervalued relative to their cash flows, indicated by high ratios of levered free cash flow/enterprise value.

Levered free cash flow is the free cash flow after deducting interest payments on outstanding debt. Enterprise value is the sum of the firm's value from all ownership sources: market cap, outstanding debt, and preferred shares. When companies have ratios of levered free cash flow/enterprise value in excess of 10%, it may indicate that the company as a whole is being undervalued.

We also screened for stocks that appear to be undervalued relative to earnings growth, with PEG below 1.

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

Tool provided by Kapitall (www.kapitall.com).

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

List sorted by LFCF/EV.

1. PACCAR Inc. (NASDAQ:PCAR): Designs, manufactures, and distributes light-, medium-, and heavy-duty trucks and related aftermarket parts primarily in the United States and Europe. Market cap at $14.32B, most recent closing price at $40.52. PEG at 0.84. Levered free cash flow at $4.41B vs. enterprise value at $20.78B (implies a LFCF/EV ratio at 21.22%).

2. R.G. Barry Corporation (NASDAQ:DFZ): Market cap at $157.3M, most recent closing price at $14.07. PEG at 0.87. Levered free cash flow at $20.96M vs. enterprise value at $145.18M (implies a LFCF/EV ratio at 14.44%).

3. Dana Holding Corporation (NYSE:DAN): Engages in the design, manufacture, and supply of products for vehicle manufacturers worldwide. Market cap at $2.07B, most recent closing price at $13.97. PEG at 0.92. Levered free cash flow at $297.75M vs. enterprise value at $2.15B (implies a LFCF/EV ratio at 13.85%).

4. Xerox Corp. (NYSE:XRX): Engages in the development, manufacture, marketing, service, and finance of document equipment, software, solutions, and services worldwide. Market cap at $9.53B, most recent closing price at $7.29. PEG at 0.85. Levered free cash flow at $2.18B vs. enterprise value at $17.94B (implies a LFCF/EV ratio at 12.15%).

5. China Automotive Systems Inc. (NASDAQ:CAAS): Engages in the manufacture and sale of power steering systems and other component parts for the automotive industry in the People's Republic of China. Market cap at $110.78M, most recent closing price at $3.92. PEG at 0.94. Levered free cash flow at $8.09M vs. enterprise value at $71.35M (implies a LFCF/EV ratio at 11.34%).

6. Nu Skin Enterprises Inc. (NYSE:NUS): Develops and distributes anti-aging personal care products and nutritional supplements worldwide. Market cap at $2.51B, most recent closing price at $41.97. PEG at 0.94. Levered free cash flow at $247.07M vs. enterprise value at $2.28B (implies a LFCF/EV ratio at 10.84%).

7. Diebold, Incorporated (NYSE:DBD): Provides integrated self-service delivery and security systems and services primarily to the financial, commercial, government, and retail markets worldwide. Market cap at $2.15B, most recent closing price at $34.09. PEG at 0.92. Levered free cash flow at $228.49M vs. enterprise value at $2.21B (implies a LFCF/EV ratio at 10.34%).

*LFCF/EV data sourced from Yahoo! Finance, all other data sourced from Finviz.

Source: 7 Consumer Goods Stocks Undervalued By Earnings Growth And Levered Free Cash Flows