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Stocks on Sale in 2020

Below you will find a list of companies that are trading at the largest percentage discount compared to their fifty-two-week highs. These stocks are considered by the market to be on sale due to their recent price depreciation. Learn more.

Company52-Week HighCurrent PriceDiscount from 52-Week HighPrice ChangeConsensus RatingPrice TargetIndicator(s)
Intelsat logo
I
Intelsat
$27.29$1.06$24.75-11.3%Hold$9.77Analyst Downgrade
Seadrill logo
SDRL
Seadrill
$10.15$0.43$22.88-2.4%Hold$0.00
DTYS
iPath US Treasury 10 year Bear ETN
$114.30$4.80$22.81flatN/A$0.00
Chesapeake Energy logo
CHK
Chesapeake Energy
$3.57$0.17$19.47+5.7%Sell$1.39Analyst Upgrade
Analyst Revision
JMIA
Jumia Technologies
$49.77$2.58$18.29-9.3%Hold$18.79Heavy News Reporting
Oasis Petroleum logo
OAS
Oasis Petroleum
$7.15$0.38$17.94+7.9%Hold$4.83Analyst Downgrade
Analyst Revision
SUNDANCE ENERGY/S logo
SNDE
SUNDANCE ENERGY/S
$36.70$1.97$17.63-5.6%Hold$6.67Analyst Downgrade
GNLN
Greenlane
$29.00$1.56$17.59+5.8%Buy$14.60Earnings Announcement
Analyst Report
Heavy News Reporting
Callon Petroleum logo
CPE
Callon Petroleum
$8.52$0.49$16.44+12.3%Hold$7.33Analyst Downgrade
Analyst Revision
McDermott International logo
MDR
McDermott International
$10.99$0.70$14.70flatSell$7.00
Sasol logo
SSL
Sasol
$34.03$2.18$14.61-1.4%Hold$0.00
MOGU
Meili
$14.09$0.96$13.68-2.1%Hold$3.80
SM Energy logo
SM
SM Energy
$18.92$1.31$13.44+9.2%Hold$10.68Analyst Report
Mallinckrodt logo
MNK
Mallinckrodt
$23.90$1.70$13.06-5.9%Hold$7.88Analyst Downgrade
Increase in Short Interest
Noble Midstream Partners logo
NBLX
Noble Midstream Partners
$40.30$3.22$11.52-5.3%Hold$29.55
HEXO
HEXO
$8.40$0.67$11.45-7.4%Hold$2.21Analyst Downgrade
Analyst Revision
CLEAR CHANNEL O/SH logo
CCO
CLEAR CHANNEL O/SH
$5.76$0.47$11.28-32.0%Hold$2.94Analyst Downgrade
Analyst Revision
U.S. Silica logo
SLCA
U.S. Silica
$18.72$1.56$11.00-5.8%Hold$10.20Unusual Options Activity
Antero Resources logo
AR
Antero Resources
$9.18$0.77$10.89+9.1%Hold$4.73Analyst Downgrade
EnLink Midstream logo
ENLC
EnLink Midstream
$12.77$1.09$10.72+0.9%Hold$8.50Analyst Upgrade
Denbury Resources logo
DNR
Denbury Resources
$2.68$0.23$10.71+3.7%Hold$0.93Analyst Downgrade
Analyst Revision
ACB
Aurora Cannabis
$9.37$0.81$10.57-2.5%Hold$3.16
Tilray logo
TLRY
Tilray
$63.62$5.54$10.48-10.1%Hold$25.93Increase in Short Interest
Nabors Industries logo
NBR
Nabors Industries
$4.08$0.36$10.36-11.1%Hold$2.18
Tenneco logo
TEN
Tenneco
$26.09$2.32$10.25-27.2%Hold$7.60Analyst Downgrade
High Trading Volume
Increase in Short Interest
Heavy News Reporting
OVV
Ovintiv
$38.50$3.43$10.22+7.9%Hold$15.37Analyst Report
Analyst Revision
Western Midstream Partners logo
WES
Western Midstream Partners
$35.75$3.20$10.17+4.1%Hold$22.17Analyst Downgrade
Increase in Short Interest
GasLog Partners LP Unit logo
GLOP
GasLog Partners LP Unit
$22.75$2.04$10.15-3.4%Hold$13.21Analyst Upgrade
Liberty Tripadvisor Holdings Inc Series A logo
LTRPA
Liberty Tripadvisor Holdings Inc Series A
$15.85$1.46$9.86+2.1%Hold$11.82
Keane Group logo
FRAC
Keane Group
$13.91$1.33$9.46+3.8%Hold$11.33
Peabody Energy logo
BTU
Peabody Energy
$30.54$3.01$9.15-12.6%Hold$18.67Unusual Options Activity
Oil States International logo
OIS
Oil States International
$21.27$2.12$9.03+4.7%Hold$16.44
Helix Energy Solutions Group logo
HLX
Helix Energy Solutions Group
$10.00$1.00$9.00-18.0%Hold$7.08Analyst Downgrade
High Trading Volume
Analyst Revision
JFIN
Jiayin Group
$22.50$2.30$8.78+6.1%Hold$2.40Analyst Downgrade
Heavy News Reporting
Patterson-UTI Energy logo
PTEN
Patterson-UTI Energy
$16.27$1.70$8.57-10.6%Hold$8.72Analyst Report
Analyst Revision
Heavy News Reporting
LK
Luckin Coffee
$51.38$5.38$8.55-19.0%Buy$40.50Analyst Report
High Trading Volume
Unusual Options Activity
Heavy News Reporting
EMMA
Emmaus Life Sciences
$11.76$1.25$8.41+2.4%Hold$0.00Heavy News Reporting
NEX
NexTier Oilfield Solutions
$12.50$1.33$8.40+3.8%Buy$6.64
Invesco Mortgage Capital logo
IVR
Invesco Mortgage Capital
$18.30$1.95$8.38-31.8%N/A$0.00Analyst Downgrade
High Trading Volume
Inflarx logo
IFRX
Inflarx
$53.10$5.66$8.38+16.8%Hold$12.50Heavy News Reporting
ALTM
Altus Midstream
$6.29$0.67$8.37-3.0%Hold$3.25Analyst Downgrade
Heavy News Reporting
Tellurian logo
TELL
Tellurian
$11.04$1.20$8.20+11.7%Hold$7.50Analyst Upgrade
Transocean logo
RIG
Transocean
$9.79$1.08$8.06-1.9%Hold$5.25Analyst Downgrade
Washington Prime Group logo
WPG
Washington Prime Group
$5.61$0.62$8.01+3.2%Sell$4.00
Crestwood Equity Partners logo
CEQP
Crestwood Equity Partners
$40.00$4.44$8.01+1.6%Buy$27.71Analyst Report
Heavy News Reporting
Michael Kors logo
KORS
Michael Kors
$75.96$8.53$7.91+4.7%N/A$0.00
SLNG
Stabilis Energy
$12.88$1.45$7.88flatN/A$0.00
Macerich logo
MAC
Macerich
$44.73$5.06$7.84+0.8%Hold$26.13Analyst Upgrade
Insider Buying
Tortoise Energy Infrastructure logo
TYG
Tortoise Energy Infrastructure
$24.29$2.75$7.83-1.5%N/A$0.00Heavy News Reporting
Emerald Expositions Events logo
EEX
Emerald Expositions Events
$14.37$1.63$7.82-29.4%Hold$10.93Analyst Downgrade
Heavy News Reporting
Last Updated: Sunday, 01:38 PM ET. Prices are 15-minutes delayed.

Executive Summary

One way for investors to find quality investments that fit their risk tolerance, time frame and investment objectives is to look for stocks that are selling at a price that is below their underlying value. This is one of the principles of value investing. This particular strategy of finding undervalued stocks dates back to 1949. That was the year Benjamin Graham published The Intelligent Investor.

Value investing is an investment strategy that involves picking stocks of companies that for one reason or another are trading at or below its intrinsic value (otherwise called its book value). Value investors use a variety of tools to actively look for stocks that may be being disregarded. One of the principals of value investing is that institutional investors and analysts overreact to the news. When this happens, it’s possible for a stock to get decoupled from its fundamentals. When this causes a stock’s price to drop lower than the company’s book value, a company can become undervalued.

The good news for investors is that there are a variety of online tools such as stock screeners that make it easy to find undervalued stocks. But investors can also look beyond the numbers to see if a company is undervalued. For example, a company that has a proprietary formula or manufacturing process may have a unique selling proposition that allows it to offer consumers lower prices.

Value investing tends to move in and out of fashion along with the economy. When the economy is going well, many investors tend to look for growth stocks. But when the economy shows weakness, value investing becomes the goal of many investors.

Introduction

One of the fundamental mistakes investors make is buying stocks that are grabbing the headlines. The problem with this approach is that when investors are all flocking to the “hot stock”, it’s almost impossible for that stock to be undervalued. This means that no matter how much you invest in these companies it will be hard for you to outperform the market.

A different, and some might say better approach, is to look at stocks of companies that are undervalued. They are fundamentally healthy companies, but for whatever reason they are selling for a price that is less than what they are worth.

This approach is known as value investing. One of the pioneers and advocates of this strategy was Benjamin Graham who first posed an investing strategy for finding undervalued stocks in his book, The Intelligent Investor.

In this article, we’ll help investors understand why a stock would be trading below its real value, how investors can use publicly available data from companies to identify undervalued stocks. We’ll also address why the internet is making it easier than ever for investors to find undervalued stocks and how investors can go beyond the numbers to find stocks that are undervalued.

Why would a stock sell below its real value?

The conventional wisdom is that when a company’s stock is falling, there is a distinct reason to stay away. But that may not be the case at all. A key principle of value investing is understanding why the market price of a stock is not always accurate. There are several reasons this may occur:

  • A company’s earnings report misses expectations. Corporate earnings reports are one of the most closely watched metrics for investors. Publicly traded companies are required to present investors with detailed financial statements that provide a snapshot of the quarter just completed and guidance for future quarters. If a company delivers results that are below the expectations of the analysts that cover the company (e.g. have lower revenue and/or earnings per share than expected) shares of the company’s stock may drop lower than the company’s fundamentals suggest should be the case.
  • The broader market crashes or corrects. When there is a broad sell-off based on a significant event (e.g. the coronavirus pandemic) it doesn’t discriminate which stocks see their share prices fall. This can be an exceptional time to find stocks of quality companies at bargain prices.
  • A specific company is hit with bad news. From a product recall to a food safety issue, a company or sector can get hit with bad headlines. However, this can lead to a disproportionate response that can take a company’s shares further down than is warranted.
  • Normal fluctuations in the business cycle. Different sectors of the economy perform better at different times of an economic cycle. When a sector is out of favor, it can be a good time to look at finding a quality company selling at a price below its underlying value.

How can investors identify undervalued stocks?

Here are six common criteria that value investors will use to identify undervalued stocks.

  1. Stocks that have a low price/earnings ratio – A stock’s price/earnings ratio indicates how much investors are willing to pay for a dollar of earnings. The price/earnings ratio is calculated by dividing a stock’s current price by its annual earnings. A lower P/E means a stock is technically “cheaper”. It is important to interpret an individual stock’s P/E ratio in context with other companies in its sector.
  2. Lagging relative price performance – Just as you can compare P/E ratios between companies in a sector, you can also compare share price. If a particular company has a share price that is lower than its peers, it can be an indication of a stock that is undervalued.
  3. Stocks that have a low price/earnings to growth ratio – A company’s price-to-earnings to growth ratio (also referred to as its PEG ratio) is found by dividing a stock’s P/E ratio by its projected earnings growth rate over a certain time period. The typical time frame is five years. A ratio of less than 1 may indicate that investors are giving more weight to past performance than to future growth opportunities. The PEG ratio can also help investors identify companies that have a relatively high P/E ratio but support that with rapidly growing earnings. This says that the company is generating both sales and profit.
  4. Stocks that are offering a high dividend yield – A high dividend yield is one of the more deceptive ways to look at a stock. As a company’s stock price goes down its dividend yield goes up. To be fair, a company that has a high dividend yield may have that because it is in financial trouble, but often it is simply a victim of temporary circumstances. If the fundamentals of the company look good, and it does not appear they will have trouble paying its dividend, then buying these stocks can provide a high dividend in the short term, and the potential for nice growth in the longer term.
  5. Stocks that have a low market-to-book ratio – A company’s market value is its total market capitalization (market cap). A company’s book value is the net asset value (NAV) of a company. To calculate book value, subtract a company’s liabilities from its assets. Then divide that result by the number of common shares outstanding. Investors that are using this metric should pay attention to is the real value of a company’s tangible assets and its intangible assets.
  6. Free cash flow – Free cash flow is the cash that a company generates after it accounts for cash outflows to support operations and maintain its capital assets. It is a measure of profitability. If a company is reporting lower earnings but a high free cash flow it can mean the company is undervalued. However, it can also be deceptive because it may mean a company is not making the best use of the cash they have on hand.

What are other metrics investors should look at to determine the value of a company?

Here are a few other metrics you can use to evaluate the value of a stock.

  • Price-to-book (P/B) ratio – This is a stock’s price divided by its equity per share. A book value of less than one suggests that a stock is trading for less than the value of the underlying company’s assets. Value investors use P/B multiples to find stocks with a margin of safety.
  • Return on equity (ROE) – This is a company’s annualized net income as a percentage of shareholder’s equity. ROE measures how efficiently a company uses its invested capital to generate profits.
  • Debt-to-equity ratio – This is a company’s total debt divided by its shareholders’ equity.
  • Current ratio – This is a ratio that expresses how easily a company can pay its short-term obligations. Current ratio is calculated by dividing a company’s current assets by its current liabilities.

Use a stock screener to help you crunch the numbers

One of the many reasons that the internet has made this a golden age for investors is that investors have more access to information than they’ve ever had. The Securities & Exchange Commission (SEC) requires companies to file their financial information prior to their earnings reports. These basic documents such as a company’s income statement, balance sheet, and cash flow statements are available on a company’s web site.

There are also a variety of stock screening tools that automatically perform these calculations such as the ones listed above. Many of these stock screeners allow you to sort companies by specific metrics so investors can easily find companies that meet the criteria that they determine.

What are other ways investors can look for undervalued stocks?

Before you start to look at the financials of specific companies, you have to narrow down your target list. Here are some guidelines to follow.

Investors should look at companies they understand – This would seem fairly obvious, but many novice investors make the mistake of investing in companies that they don’t understand. For example, in the dot-com boom many investors were buying shares of companies simply because they had a .com in their name. But the internet in general was a new phenomenon and many investors did not realize that many of these businesses had flawed, if any, business model. Sticking with businesses that they know can help investors understand what the company’s numbers actually mean.

Look beyond a company’s numbers when necessary – You sometimes hear about a company having a “moat”. This simply means that its business is protected, to a certain extent, from competition. A good example of this is a company like Walmart which based on its size and efficiency can simply keep prices lower than many other retailers. Companies with a moat tend to perform well in tough economic times because customers will seek out their business for lower prices.

This also applies to companies that provide the goods and services that are stocked inside a Walmart. You hear the words “defensive stocks”. These are companies that make products that consumers need regardless of the state of the economy.

Conclusion

Finding undervalued stocks is not an exact science. Value investing in general frequently goes out of fashion when the economy is good. When the market is rising, it’s easy for investors to lose sight of their investment objectives and even their risk tolerance as they try to chase after the highest flying stocks.

Unfortunately, as we’ve seen many times, when the market goes down there is a flight to safety and quality. At times like these, investors take a closer look at the merits of value investing. One of the most difficult things for investors to see is that there are well-performing stocks in any economy. One of the keys for investors is not only staying engaged in the market, but also to look for undervalued stocks that can help their portfolio regardless of what direction the market is moving.  

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