6 Low P/E Stocks Gurus Are Buying
- By Tiziano Frateschi
The following stocks have low price-earnings ratios and have been bought by gurus. While some of them are great investments, others need to be checked again, according to the discounted cash flow calculator .
With a market cap of $2.62 billion, Delek U.S. Holdings Inc. (DK) is trading with a price-earnings ratio of 5.95, a price-sales ratio of 0.28 and a forward price-earnings ratio of 8.27. According to the DCF calculator, the stock has a fair value of $59.72 while trading at $32. The share price has fallen 18% over the last 12 months and is currently 48.08% below its 52-week high and 8.34% above its 52-week low.
GuruFocus gives the integrated oil and gas company a profitability and growth rating of 4 out of 10. The return on equity of 26.95% and return on assets of 7.26% are outperforming 60% of companies in the Global Oil and Gas Refining and Marketing industry. Its financial strength is rated 6 out of 10. The cash-debt ratio of 0.60 is below the industry median of 0.61.
The company's largest guru shareholder is Steven Cohen (Trades, Portfolio) with 3.53% of outstanding shares, followed by Ken Fisher (Trades, Portfolio) with 1.01%, Jim Simons (Trades, Portfolio) ' Renaissance Technologies with 0.56%, Pioneer Investments (Trades, Portfolio) with 0.15% and Barrow, Hanley, Mewhinney & Strauss with 0.1%.
With a $22.83 billion market cap, Dollar Tree Inc. (DLTR) is trading with a price-earnings ratio of 13.02, a price-sales ratio of 1.0 and a forward price-earnings ratio of 16.86. According to the DCF calculator, the stock has a fair value of $200.32 while trading at $94. The share price fell 39% over the last 12 months and is currently 17.75% below its 52-week high and 21.79% above its 52-week low.
GuruFocus gives the discount retail chain a profitability and growth rating of 9 out of 10. The return on equity of 24.23% and return on assets of 10.89% are outperforming 89% of companies in the Global Discount Stores industry. Its financial strength is rated 6 out of 10. The cash-debt ratio of 0.14 is below the industry median of 0.55.
Chuck Akre (Trades, Portfolio) is the company's largest guru shareholder with 2.14% of outstanding shares, followed by Larry Robbins (Trades, Portfolio) with 0.5%, Pioneer Investments with 0.22% and Jana Partners (Trades, Portfolio) with 0.16%.
With a market cap of $12.36 billion, Devon Energy Corp. (DVN) is trading with a price-earnings ratio of 6.17, a price-sales ratio of 0.85 and a forward price-earnings ratio of 19.69. The share price fell 39% over the last 12 months and is currently 43.27% below its 52-week high and 29.60% above its 52-week low.
GuruFocus gives oil and gas producer a profitability and growth rating of 6 out of 10. The return on equity of 24.86% and return on assets of 7.69% are outperforming 71% of companies in the Global Oil and Gas E&P industry. Its financial strength is rated 6 out of 10 with a cash-debt ratio of 0.51.
The company's largest guru shareholder is Paul Singer (Trades, Portfolio) with 2.4% of outstanding shares, followed by Diamond Hill Capital (Trades, Portfolio) with 2.02%, Barrow, Hanley, Mewhinney & Strauss with 1.18% and Cohen with 1.04%.
DXC Technology Co. (DXC) has a market cap of $17.01 billion; the stock is trading with a price-earnings ratio of 9.44, a price-sales ratio of 0.77 and a forward price-earnings ratio of 6.90. According to the DCF calculator, the stock has a fair value of $93.08 while trading at $60.71. The share price has fallen 30% over the last 12 months and is currently 43.71% below its 52-week high and 23.42% above its 52-week low.
GuruFocus gives the independent, end-to-end IT services company a profitability and growth rating of 5 out of 10. The return on equity of 15.11% and return on assets of 5.85% are outperforming 63% of companies in the Global Information Technology Services industry. Its financial strength is rated 6 out of 10. The cash-debt ratio of 0.40 is below the industry median of 4.27.
With 1.71% of outstanding shares, Robbins is the company's largest guru shareholder, followed by Lee Ainslie (Trades, Portfolio) with 1.44%.
Eastman Chemical Co. (EMN) has a market cap of $10.6 billion. It is trading with a price-earnings ratio of 7.11 and a price-sales ratio of 1.08. According to the DCF calculator, the stock has a fair value of $274.55 while trading at about $75.72. The share price has fallen 22% over a 12-month period and is currently 32.66% below its 52-week high and 12.34% above its 52-week low.
The company, which produces portfolio of chemicals, plastics and fibers, has a GuruFocus profitability and growth rating of 8 out of 10. The return on equity of 27.86% and return on assets of 9.49% are outperforming 73% of companies in the Global Chemicals industry. Its financial strength is rated 5 out of 10. The equity-asset ratio of 0.03 is below the industry median of 0.72.
The company's largest guru shareholder is Diamond Hill Capital with 0.84% of outstanding shares, followed by Pioneer Investments with 0.24% and Simons' firm with 0.15%.
EOG Resources Inc. (EOG) has a market cap of $57.17 billion; the stock is trading with a price-earnings ratio of 11.53 and a price-sales ratio of 5.08. According to the DCF calculator, the stock has a fair value of $91.5 while trading at about $98. The share price has fallen 13% over the last 12 months and is currently 26.17% below its 52-week high and 20.17% above its 52-week low.
GuruFocus gives the oil and gas producer a profitability and growth rating of 6 out of 10. The return on equity of 29.85% and return on assets of 15.98% are outperforming 86% of companies in the Global Oil and Gas E&P industry. Its financial strength is rated 6 out of 10. The cash-debt of 0.20 is below the industry median of 0.51.
PRIMECAP Management (Trades, Portfolio) is the company's largest guru shareholder with 0.37% of outstanding shares, followed by Pioneer Investments with 0.29% and John Rogers (Trades, Portfolio) with 0.07%.
Disclosure: I do not own any stocks mentioned in this article.
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This article first appeared on GuruFocus.
