Value stocks offer stability for investors by focusing on companies that seem underpriced compared to their actual worth. This approach involves looking for stocks with strong fundamentals and growth potential. By investing in these stocks, investors can achieve significant returns once the market recognizes their true value.
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One way to identify value stocks is by comparing a company’s price-to-earnings (P/E) ratio with industry averages or its historical P/E ratios. This ratio compares a company’s stock price to its earnings per share. It must be noted that a lower P/E ratio may indicate that the stock is undervalued. Along with this, we have zeroed in on stocks that have received Strong Buy ratings from Wall Street analysts.
Here are this week’s stocks:
Applied Materials (AMAT) – This company provides equipment, software, and services for manufacturing semiconductors, displays, and other advanced materials. It has a Strong Buy analyst consensus rating and an average price target of $201.44, implying a 5.48% upside potential from the current levels. The company’s P/E of 22.26x is trading at a 23.9% discount to the Technology sector’s median of 29.38.
Trip.com (TCOM) – This global online travel agency offers booking services for flights, hotels, trains, and vacation packages. Its average price target of $76 implies a 29.65% upside potential from the current levels. TCOM stock has a Strong Buy consensus rating. The company’s P/E of 17.24x is trading at a 12% discount to the Consumer Cyclical sector’s median of 19.58.
Pinterest (PINS) – Pinterest is a social media platform where users find, save, and share ideas through images and videos. It has a Strong Buy analyst consensus rating and an average price target of $39.64, implying a 10.88% upside potential from the current levels. The company’s P/E of 12.98x is trading at a 35.9% discount to the Communication Services sector’s median of 20.24.