The 20 Best Stocks For Value Investors This Week

|
Includes: AGCO, AIG, AIZ, AMP, BBT, CBS, CINF, DNR, DWDP, FTI, KIM, LEN, LNC, NVDA, PFG, PNC, SNA, TGNA, UNM, VAR
by: Benjamin Clark

Summary

ModernGraham analyzed 41 different companies this week, and has narrowed the list to the best of those companies.

All of the stocks listed here are suitable for either the Defensive Investor or the Enterprising Investor following the ModernGraham approach.

Each company is either found to be undervalued or fairly valued by the ModernGraham formula.

We evaluated 41 different companies this week to determine whether they are suitable for Defensive Investors, those unwilling to do substantial research, or Enterprising Investors, those who are willing to do such research. We also put each company through the ModernGraham valuation model based on Benjamin Graham's value investing formulas in order to determine an intrinsic value for each. Out of those 41 companies, only 20 were found to be undervalued or fairly valued and suitable for either Defensive or Enterprising Investors. Here's a summary of those 20 best stocks for value investors this week.

The Elite

The following companies were found to be suitable for either the Defensive Investor or Enterprising Investor and undervalued:

American International Group Inc. (NYSE:AIG)

American International Group Inc. qualifies for the Enterprising Investor but not the Defensive Investor. The Defensive Investor is concerned by the insufficient earnings growth or stability over the last ten years, and the inconsistent dividend record, while the company passes all of the Enterprising Investor's requirements. As a result, Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with further research into the company and comparing it to other opportunities.

As for a valuation, the company appears undervalued after growing its EPSmg (normalized earnings) from a loss of $109.06 in 2011 to an estimated gain of $5.36 for 2015. This level of demonstrated growth is greater than the market's implied estimate of 1.66% earnings growth and leads the ModernGraham valuation model, which is based on Benjamin Graham's formula, to return an estimate of intrinsic value above the market price. (See the full valuation)

Ameriprise Financial Inc. (NYSE:AMP)

Ameriprise Financial Inc. qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the insufficient earnings stability over the last ten years, while the Enterprising Investor has no initial concerns. As a result, all value investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the next stage of the analysis.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $3.42 in 2011 to an estimated $7.45 for 2015. This level of demonstrated earnings growth outpaces the market's implied estimate of 3.92% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price. (See the full valuation)

BB&T Corporation (NYSE:BBT)

BB&T Corporation qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the insufficient earnings growth over the last ten years, while the Enterprising Investor has no initial concerns. As a result, all value investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the next stage of the analysis.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $1.72 in 2011 to an estimated $2.48 for 2015. This level of demonstrated earnings growth outpaces the market's implied estimate of 3.80% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

CBS Corporation (NYSE:CBS)

CBS Corporation qualifies for the Enterprising Investor but is not suitable for the more conservative Defensive Investor. The Defensive Investor is concerned with the low current ratio, insufficient earnings growth or stability over the last ten years, and the high PB ratio. The Enterprising Investor is only concerned with the level of debt relative to the net current assets. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with further research into the company.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from a loss of $1.23 in 2011 to an estimated gain of $3.53 for 2015. This level of demonstrated earnings growth outpaces the market's implied estimate of 2.84% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

Denbury Resources Inc. (NYSE:DNR)

Denbury Resources Inc. qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the company size, insufficient earnings growth or stability over the last ten years along with the short dividend history. The Enterprising Investor is concerned with the level of debt relative to the net current assets. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the evaluation.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $0.88 in 2011 to an estimated $1.05 for 2015. This level of demonstrated earnings growth surpasses the market's implied estimate of 2.58% annual earnings decline over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

FMC Technologies Inc. (NYSE:FTI)

FMC Technologies qualifies for the Enterprising Investor but is not suitable for the more conservative Defensive Investor. The Defensive Investor is concerned with the low current ratio and the lack of dividends. The Enterprising Investor is only concerned with the lack of dividends. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with further research into the company.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $1.50 in 2011 to an estimated $2.29 for 2015. This level of demonstrated earnings growth outpaces the market's implied estimate of 3.03% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

Kimco Realty Corporation (NYSE:KIM)

Kimco Realty Corporation is suitable for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the insufficient earnings stability or growth over the last ten years, and the high PEmg ratio. The Enterprising Investor is only concerned with the high level of debt relative to the net current assets. As a result, all Enterprising Investors following the ModernGraham approach should feel comfortable proceeding with the valuation.

From a valuation side of things, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $0.33 in 2011 to an estimated $0.96 for 2015. This level of growth outpaces the market's implied estimate of 8.76% annual earnings growth over the next 7-10 years, leading the ModernGraham valuation model to return an estimate of intrinsic value above the current price.

Lennar Corporation (NYSE:LEN)

Lennar Corporation qualifies for the Enterprising Investor but is not suitable for the more conservative Defensive Investor. The Defensive Investor is concerned with the insufficient earnings growth or stability over the last ten years. The Enterprising Investor has no initial concerns. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with further research into the company.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from a loss of $1.95 in 2011 to an estimated gain of $2.62 for 2015. This level of demonstrated earnings growth outpaces the market's implied estimate of 5.63% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value below the price.

Lincoln National Corporation (NYSE:LNC)

Lincoln National Corporation qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the insufficient earnings stability over the last ten years, while the Enterprising Investor has no initial concerns. As a result, all value investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the next stage of the analysis.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $0.80 in 2011 to an estimated $5.48 for 2015. This level of demonstrated earnings growth outpaces the market's implied estimate of 0.88% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

PNC Financial Services Group Inc. (NYSE:PNC)

PNC Financial Services Group Inc. qualifies for both the Defensive Investor and the Enterprising Investor. The company passes all of the requirements of both investor types, an accomplishment indicative of strong financial strength and stability. As a result, all value investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the next stage of the analysis.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $4.90 in 2011 to an estimated $6.91 for 2015. This level of demonstrated earnings growth outpaces the market's implied estimate of 2.73% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

Principal Financial Group (NYSE:PFG)

Principal Financial Group qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the insufficient earnings growth over the last ten years. The Enterprising Investor has no initial concerns. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the next stage of the analysis.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $1.99 in 2011 to an estimated $3.48 for 2015. This level of demonstrated earnings growth outpaces the market's implied estimate of 3.79% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

Snap-on Inc. (NYSE:SNA)

Snap-on Inc. qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the high PEmg and PB ratios. The Enterprising Investor has no initial concerns. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the evaluation.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $3.63 in 2011 to an estimated $6.72 for 2015. This level of demonstrated earnings growth surpasses the market's implied estimate of 8.1% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

Tegna Inc. (NYSE:TGNA)

Tegna Inc. qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the insufficient earnings growth or stability over the last ten years along with the low current ratio. The Enterprising Investor is concerned with the level of debt relative to the net current assets. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the evaluation.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from a loss of $2.00 in 2011 to an estimated gain of $2.50 for 2015. This level of demonstrated earnings growth surpasses the market's implied estimate of 1.06% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

Unum Group (NYSE:UNM)

Unum Group qualifies for both the Defensive Investor and the Enterprising Investor, as the company passes all of the requirements of both investor types. As a result, all value investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the next stage of the analysis.

As for a valuation, the company appears to be undervalued after growing its EPSmg (normalized earnings) from $1.89 in 2011 to an estimated $2.73 for 2015. This level of demonstrated earnings growth outpaces the market's implied estimate of 2.29% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value above the price.

The Good

The following companies were found to be suitable for the Defensive Investor or Enterprising Investor and Fairly Valued:

AGCO Corporation (NYSE:AGCO)

AGCO Corporation qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the short dividend record, insufficient earnings stability over the last ten years, and the low current ratio. The Enterprising Investor has no initial concerns. As a result, all value investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the evaluation.

As for a valuation, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $3.58 in 2011 to an estimated $4.32 for 2015. This level of demonstrated earnings growth supports the market's implied estimate of 2.33% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value within a margin of safety relative to the price.

Assurant Inc. (NYSE:AIZ)

Assurant Inc. qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the inconsistent dividend record and the insufficient earnings growth over the last ten years. The Enterprising Investor has no initial concerns. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the next stage of the analysis.

As for a valuation, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $4.09 in 2011 to an estimated $5.41 for 2015. This level of demonstrated earnings growth supports the market's implied estimate of 3.07% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value within a margin of safety relative to the price.

Cincinnati Financial Corporation (NASDAQ:CINF)

Cincinnati Financial Corporation qualifies for the Enterprising Investor but not the more conservative Defensive Investor. The Defensive Investor is concerned with the insufficient earnings growth over the last ten years. The Enterprising Investor has no initial concerns. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the evaluation.

As for a valuation, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $2.16 in 2011 to an estimated $2.92 for 2015. This level of demonstrated earnings growth supports the market's implied estimate of 5.22% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value within a margin of safety relative to the price.

E I du Pont de Nemours & Company (DD)

E I du Pont de Nemours & Company qualifies for both the Defensive Investor and the Enterprising Investor. The Defensive Investor is only initially concerned with the high PB ratio. The Enterprising Investor has no initial concerns. As a result, all value investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with the evaluation.

As for a valuation, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $2.99 in 2011 to an estimated $3.64 for 2015. This level of demonstrated earnings growth supports the market's implied estimate of 3.16% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value within a margin of safety relative to the price.

Nvidia Corporation (NASDAQ:NVDA)

Nvidia Corporation qualifies for the Enterprising Investor but is not suitable for the more conservative Defensive Investor. The Defensive Investor is concerned with the insufficient earnings growth or stability over the last ten years, the short dividend record, and the high PEmg and PB ratios. The Enterprising Investor has no initial concerns. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with further research into the company.

As for a valuation, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $0.48 in 2012 to an estimated $0.82 for 2016. This level of demonstrated earnings growth supports the market's implied estimate of 10.24% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value within a margin of safety relative to the price.

Varian Medical Systems Inc. (NYSE:VAR)

Varian Medical Systems Inc. qualifies for the Enterprising Investor but is not suitable for the more conservative Defensive Investor. The Defensive Investor is concerned with the inconsistent dividend record, and the high PEmg and PB ratios. The Enterprising Investor is only concerned with the lack of dividends. As a result, all Enterprising Investors following the ModernGraham approach based on Benjamin Graham's methods should feel comfortable proceeding with further research into the company.

As for a valuation, the company appears to be fairly valued after growing its EPSmg (normalized earnings) from $2.82 in 2011 to an estimated $3.95 for 2015. This level of demonstrated earnings growth supports the market's implied estimate of 6.63% annual earnings growth over the next 7-10 years. As a result, the ModernGraham valuation model, based on Benjamin Graham's formula, returns an estimate of intrinsic value within a margin of safety relative to the price.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.