Financial services firm Morningstar (MORN) has come out with a batch of new top-rated stocks that it says are undervalued in the current market.
Chicago-based Morningstar, which specializes in investment research, says each of the five-star rated stocks has declined amid the current market volatility to the point where they are now undervalued and ripe for the picking by investors.
The best known stock on Morningstar’s list of five-star rated companies whose shares now look cheap is technology giant Alphabet (GOOGL). Morningstar writes that “Alphabet has dropped 19.84% over the past three months and climbed 2.75% over the past year. The stock is trading at a 35% discount to its fair value estimate of $237 per share… Alphabet is a large-value company with a wide economic moat.”
Other Five-Star Stocks
The other stocks cited by Morningstar include IQVIA Holdings (IQV), On Semiconductor (ON), Align Technology (ALGN), and RingCentral (RNG). Each of these stocks has lost more than 25% over the last 12 months and is now trading at a deep discount to its fair market value, says Morningstar.
Yet despite the big share price decreases, each of these stocks holds a top five-star rating and could make a solid long-term investment for investors who have patience and a long time horizon. Morningstar emphasizes that there are deals to be found in the current market despite ongoing volatility caused by trade tariffs and economic data.
Is GOOGL Stock a Buy?
The stock of Alphabet has a consensus Moderate Buy rating among 37 Wall Street analysts. That rating is based on 27 Buy and 10 Hold recommendations assigned in the last three months. The average GOOGL price target of $212.09 implies 35.03% upside from current levels.
