5 Best Value Stocks

Since the mid of 2022, the stock market has been experiencing one of the biggest correction in recent years. There are many factors contributing to this downward trend: sky-high inflation, increasing interest rates by Fed, Russian-Ukraine war, China's strict and prolonged COVID lockdown, the pandemic bubble popped as countries opening back up and people go outside/back to work, cancelled COVID stimulus payments, etc... With no free money from the governments, the days of throwing moneys to cryptos or meme stocks and get unbelievable returns are over. Many investors nowadays are looking for solid and reliable value stocks that have a proven track record and a higher chance of providing solid returns in this bear market.

A value stock is a type of stock that is believed to be undervalued by the market in relation to its intrinsic value or true worth. In other words, a value stock is a stock that is trading at a lower price than what it is worth based on its financial and operational fundamentals. Value investors often look for stocks that have a low price-to-earnings ratio, low price-to-book ratio, and a high dividend yield. These stocks are typically associated with well-established companies that have a history of steady earnings and dividends but may be facing temporary setbacks or challenges.

Below is the list of 5 excellent value stocks in our opinion. The valuation results below are from ValueInvesting.io, one of the most comprehensive value investing platforms on the market.

1. Amazon

Amazon is one of the largest and most successful companies in the world, and its stock is one of the most widely traded and closely watched stocks on the market.

Amazon's stock has performed extremely well over the years, and has delivered impressive returns to its shareholders. The stock has experienced significant growth since its initial public offering in 1997, with a steady upward trend in the long term, punctuated by occasional dips and corrections.

One of the reasons for Amazon's success is the company's dominant position in the e-commerce industry. Amazon has been able to establish a massive online retail platform that offers customers a vast selection of products at competitive prices, b acked by fast and reliable delivery services. In addition to its core e-commerce business, Amazon has also expanded into a variety of other areas, including cloud computing, streaming video, and digital advertising.

Overall, Amazon's stock is considered a strong long-term investment by many analysts. This is reflected by ValueInvesting.io's valuation for Amazon with 40% upside currently.

Check out Amazon's valuation result.

2. Pfizer

Pfizer is a pharmaceutical company that produces a wide range of drugs and vaccines for various medical conditions

Pfizer's stock has experienced significant volatility over the years, reflecting both the company's successes and challenges. Like other pharmaceutical companies, Pfizer is subject to a range of external factors that can impact its performance, including regulatory approvals, patent expirations, and competition from other companies.

One of Pfizer's most significant recent successes was the development of its COVID-19 vaccine in collaboration with BioNTech, which has played a crucial role in the global response to the pandemic. The announcement of the vaccine's effectiveness in late 2020 led to a significant increase in Pfizer's stock price. Since then, the company's revenue has been growing tremendously with 13.8% CAGR (5-year) in terms of revenue.

Pfizer has also faced challenges, including patent expirations for some of its key drugs and increased competition in certain markets. In recent years, the company has focused on diversifying its product portfolio and investing in research and development to drive future growth.

Nonetheless, with as a market leader in providing COVID booster shots which will not be going away anytime soon, we expect Pfizer's stock price to continue doing well in the future.

Check out Pfizer's valuation result.

3. Alphabet/Google

Alphabet is a multinational conglomerate company that owns a diverse portfolio of businesses, including Google, YouTube, and Google Cloud

Alphabet's stock has experienced steady growth over the years, driven by the company's dominant position in the online advertising industry nd its leadership in innovation and technology. The company's businesses generate significant revenue and profits, and Alphabet has consistently delivered strong financial results to its shareholders.

One of the key factors driving Alphabet's success is its ability to continuously innovate and invest in new technologies and businesses. The company has a strong track record of developing new products and services, such as Google's search engine, YouTube, and Google Cloud, which have become integral parts of many people's daily lives. Alphabet's cash reserve is also sitting at roughly $133 billions, allowing the companies to explore multiple long-term bets which could yield a huge return in the future like Cloud Computing, quantum computing, AI services (BARD), etc..

Alphabet has also demonstrated a commitment to corporate responsibility, with initiatives focused on sustainability, diversity and inclusion, and social impact.

Overall, Alphabet's stock is considered a solid long-term bets by many investors globally, with the potential for continued growth and innovation. According to ValueInvesting.io, its upside is up to 38%

Check out Alphabet's valuation result.

4. AT&T

AT&T is a telecommunications company that provides a range of services, including wireless and wired internet, TV, and phone services

AT&T's stock has a long history and is considered by many investors to be a relatively stable investment. However, the company has experienced some challenges in recent years, including increased competition and changing consumer preferences.

One of AT&T's significant recent developments was the acquisition of Time Warner in 2018, which gave the company access to a broad range of media assets, including HBO and Warner Bros. This move was part of AT&T's strategy to diversify its business and become a leader in the entertainment industry.

AT&T's financial performance has been relatively consistent over the years, with steady revenue and earnings growth. The company has also been working to reduce debt levels and optimize its cost structure.

Overall, even though its revenue growth rate has slow down in the past few years (0.8% CAGR), AT&T is still expected to maintain a solid and leading position in the telecommunication market in the future, with the potential for steady returns over time

Check out AT&T's valuation result.

5. Procter & Gamble Co

Procter & Gamble Co. (P&G) is a multinational consumer goods company that produces and distributes a wide range of household, personal care, and beauty products.

P&G is a well-established company with a long history, and its stock is considered by many investors to be a relatively stable investment. The company's portfolio of brands includes many household names, such as Tide, Pampers, Crest, Gillette, and Pantene, among others.

P&G's financial performance has been relatively consistent over the years, with steady revenue and earnings growth. The company has been focused on optimizing its operations and investing in research and development to drive innovation and growth. With hundreds of well-known brands diversified into multiple segments, P&G is guaranteed to be in a great position to do well in any market downturn situations.

One of P&G's recent initiatives has been to focus on sustainability and social responsibility, with initiatives aimed at reducing the company's environmental footprint, improving social outcomes, and promoting diversity and inclusion.

Overall, P&G is generally considered a safe and solid investment by investors. Its stock price has been closely tracking the S&P 500 index for many years.

Check out Procter & Gamble's valuation result.

Final remark

Above is the list of 5 value stocks that we think have a lot of potentials based on their fundamentals and track-record. Let us know if you think we miss any promising and solid value stocks.

Disclaimer: We have no affiliations to any of these companies. This post is not a financial advice.

If you are interested in getting short interest data as a part of your value investing toolkit, do check out ValueInvesting.io's short interest api as well.