Today, August 12, 2022, Dow Jones is trading at ~33,737, the S&P 500 at ~4,270, and Nasdaq at ~13,029. In the current market status, what could be considered the must buy stocks right now?
Inflation may be near its peak for some analysts, but the market doesn’t seem confident we’re completely out of the woods yet. Not only is it a great time to buy the market right now, but it’s also the best of times to find good undervalued stocks.
And that is exactly what we did. In this post, we are going to mention 5 undervalued stocks issued by stable companies with profitable businesses.
Note: Make sure that you do your own due diligence before you buy any of the following stocks mentioned.
Let’s get started…
1. Fomento Economico Mexicano SAB de CV (NYSE: FMX)
Business
Fomento Económico Mexicano (or FEMSA), founded in 1890 and based in Monterrey, Mexico, is a conglomerate with controlling interests in the following entities:
- Coca-Cola Femsa
- Logistics and distribution
- Femsa Comercio
- CB Equity
The firm is primarily a producer, marketer, and distributor of Coca-Cola trademark beverages in Mexico, Nicaragua, Guatemala, Venezuela, Panama, Argentina, Colombia, Costa Rica, Brazil, and Uruguay.
On top of that, Femsa is also engaged in building specialized distribution and logistics services in the United States.
Forecast
Based on the 17 analysts’ 12-month median price target of $91.69 and the stock’s trading price, FMX now has a 136.67% upside. The highest price target is $156.18 which represents a 136.67% upside and the lowest is $57.44 which represents a 12.96 downside.
Fundamentals
| P/E ratio | 17.74x |
| P/B ratio | 1.45x |
| ROE (Last Year) | 11.24% |
| Revenue Growth (YoY) | 13.15% |
| Current Ratio | 1.69x |
| Interest Coverage | 3.23x |
| D/E ratio | 1.20x |
Source: FMX Annual Report
2. Bunge Ltd (NYSE: BG)
Business
Bunge, founded in 1818 and headquartered in St. Louis, Missouri, is an agribusiness and food company with global operations. More so, the company is a leading oilseed processor of vegetable oils, among other food products.
The company does business through 4 segments:
- Agribusiness (purchasing, storing, transporting, processing, and selling commodity products and agricultural commodities)
- Refined and Specialty Oils (selling packaged and bulk fats and oils)
- Milling (selling bakery mixes and wheat flours)
- Sugar and Bioenergy (producing ethanol and sugar)
Approximately two thirds of Bunge’s profits are generated from the agribusiness segment and includes the largest oilseed processing capacity globally.
Forecast
Based on the 11 analysts’ 12-month median price target of $125 and the stock’s trading price, BG now has a 23.52% upside. The highest price target is $160 which represents a 58.10% upside and the lowest is $106 which represents a 4.74% upside.
Fundamentals
| P/E ratio | 8.72x |
| P/B ratio | 1.96x |
| ROE (Last Year) | 26.56% |
| Revenue Growth (YoY) | 42.87% |
| EPS Growth (YoY) | 76.91% |
| Current Ratio | 1.77x |
| Interest Coverage | 8.96x |
| D/E ratio | 2.04x |
Source: BG Annual Report
3. Nutrien Ltd (NYSE: NTR)
Business
Nutrien, founded in 2018 and headquartered in Saskatoon, Canada, is the third largest fertilizer producer in the world based on capacity.
The company produces potash, nitrogen, and phosphate, with potash being its main focus (the company is the world market leader when it comes to potash production).
On top of that, Nutrien is the largest US agricultural retailer, providing fertilizers, seeds, crop chemicals, and services directly to farm customers.
Forecast
Based on the 22 analysts’ 12-month median price target of $113.5 and the stock’s trading price, NTR now has a 22.90% upside. The highest price target is $141 which represents a 52.68% upside and the lowest is $70 which represents a 24.20% downside.
Fundamentals
| P/E ratio | 5.78x |
| P/B ratio | 2.23x |
| ROE (Last Year) | 13.41% |
| Revenue Growth (YoY) | 32.54% |
| EPS Growth (YoY) | 581.48% |
| Current Ratio | 1.11x |
| Interest Coverage | 7.80x |
| D/E ratio | 1.11x |
Source: NTR Annual Report
4. Wesco International Inc (NYSE: WCC)
Business
Wesco International, founded in 1922 and headquartered in Pittsburgh, Pennsylvania, is a value-added industrial distributor that provides supply chain solutions, logistics services, and B2B distribution.
The company has 3 segments:
- Electrical and electronic solutions (providing supply chain solutions)
- Communications and security solutions (operating in the network infrastructure and security markets)
- Utility and broadband solutions (offering products/services to public power companies, investor-owned utilities, broadband operators, service and wireless providers, and contractors)
Most of Wesco’s revenue is generated in the US (72%). However, the company’s operations in 50 other countries constitute its global reach.
Forecast
Based on the 10 analysts’ 12-month median price target of $170 and the stock’s trading price, WCC now has a 21.20% upside. The highest price target is $200 which represents a 42.59% upside and the lowest is $130 which represents a 7.31% downside.
Fundamentals
| P/E ratio | 11.18x |
| P/B ratio | 1.89x |
| ROE (Last Year) | 12.35% |
| Revenue Growth (YoY) | 47.80% |
| EPS Growth (YoY) | 419.21% |
| Current Ratio | 2.08x |
| Interest Coverage | 2.99x |
| D/E ratio | 2.34x |
Source: WCC Annual Report
5. Prestige Consumer Healthcare Inc (NYSE: PBH)
Business
Prestige Consumer Healthcare, founded in 1996 and headquartered in Tarrytown, New York, is a distributor of over-the-counter healthcare and household cleaning products.
The company’s customers include drugstores, convenience stores, e-commerce channels, mass merchandisers, and supermarkets.
Prestige operates through multiple brands, such as Chloraseptic, BC/Goody’s, Hydralyte, Compound W, Monistat, Debrox, Fess, Summer’s Eve, Dramamine, Clear Eyes, Fleet, Gaviscon, and Nix.
Its portfolio includes branded products in eye and ear care, gastrointestinal, cough and cold, analgesics, dermatological products, skincare, oral care, women’s health, and sleep aids.
Forecast
Based on the 5 analysts’ 12-month median price target of $68 and the stock’s trading price, PBH now has a 19.82% upside. The highest price target is $72 which represents a 26.87% upside and the lowest is $60 which represents a 5.73% upside.
Fundamentals
| P/E ratio | 14.12x |
| P/B ratio | 1.79x |
| ROE (Last Year) | 13.02% |
| Revenue Growth (YoY) | 15.21% |
| EPS Growth (YoY) | 24.31% |
| Current Ratio | 2.04x |
| Interest Coverage | 5.13x |
| D/E ratio | 1.33x |
Source: PBH Annual Report
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