The following stocks are highly undervalued according to their Growth Rate (NYSE:FCF), using a 15% discount rate, and offer investors consistent dividends.
Stocks are ranked in order of their Vuru Grade, which ranks stocks based on the quality of the company and its valuation. It has consistently outperformed the market over the past 3, 5, and 10 year periods.
We hope you’ll use this list as a starting point for your analysis.
McGraw-hill Ryerson Ltd (MHR.TO)
MHR.TO publishes and distributes educational and professional products in print and digital formats. They serve post-secondary institutions, elementary and secondary schools and professional readers.
· Excellent CROIC (61.98% in 2010)
· Growing Positive Free Cash Flow (6.53m in 2004 and 22.64m in 2010)
· Gross Margins Increasing (51.01% in 2001 and 61.93% in 2010)
· Overvalued according to Net Current Asset Price
· Highly Competitive Industry (9.39% Net Income Margin in 2010)
Current Price: $44.00
Growth Price: $138.66
Undervalued by 215.13%
Vuru Grade 90.16. See Full Report Here.
Educational Development Corporation (NASDAQ:EDUC)
EDUC is a US based trade publisher of educational children’s books. They distribute books through independent consultants who hold book shows at individual homes, book fairs, direct sales and Internet sales.
· Steadily Growing Dividends Yield (0.49% Div. Yield in 2002 and 9.44% Div. Yield in 2011)
· Non-Capital Intensive (18.15% of Profits Spent on Capital Expenditures)
· Declining Return on Equity in the Last 4 Years (15.37% ROE in 2007 to 7.97% ROE in 2011)
· Competitive Industry with Thin Net Income Margins (4.29% Net Income Margin in 2011)
Current Price: $5.50
Growth Price: $7.82
Undervalued by 42.17%
Vuru Grade 89.73. See Full Report Here.
Nokia Corporation (NYSE:NOK)
Nokia’s mobile division develops mobile products, applications and content. Their other divisions also provide digital map information and other location-based content as well as mobile and fixed network infrastructure.
· Rising Dividend Yield (1.54% in 2001 to 3.97% in 2010)
· Excellent CROIC since 2001
· Satisfactory Pricing Power (30% Gross Margin in 2010)
· Weakening Balance Sheet
· Increasingly Competitive Industry (Net Income Margin 4.36% in 2010)
Current Price: $6.42
Growth Price: $12.44
Undervalued by 93.72%
Vuru Grade 88.43. See Full Report Here.
Warwick Valley Telephone Company (WWVY)
Warwick provides telephone service to customers in New York and New Jersey. They also provide voice over internet protocol, internet and video services in partnership with DIRECTV, INC..
· Strong Balance Sheet (TL-to-TA 0.31 in 2010)
· Growing Positive Free Cash Flow (8.88m in 2004 to 10.80 in 2010)
· Consistently Strong Pricing Power (50.96% Gross Margin in 2010)
· Overvalued According to Stability Price
· Highly Capital Intensive Business (72.84% of Profits Spent on Capital Expenditures)
Current Price: $14.70
Growth Price: $20.06
Undervalued by 36.48%
Vuru Grade 88.09. See Full Report Here.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.