5 Undervalued US Stocks

Stock pick like a professional by only investing in stocks trading at less than their fair value. Warren Buffett uses value investing to manage his own portfolio

Emma Wall 7 January, 2014 | 2:30PM

Value investing is the art of picking up stocks that are trading at less than their intrinsic value. The most famous value investor is Warren Buffett, who warns against going the way of the crowd - preferring instead to contrarian invest, buying stocks that the market is less interested in. 

"Long ago, Ben Graham taught me that 'Price is what you pay; value is what you get.' Whether we’re talking about socks or stocks, I like buying quality merchandise when it is marked down," says Buffett.

Morningstar star ratings can help investors determine which stocks are undervalued. Whereas the fund and ETF star ratings are both backward-looking quantitative measures of a fund's risk/reward profile, the stock star rating is completely different. It's both quantitative and qualitative, for starters, and it's meant to be forward-looking.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Coca-Cola Co50.45 USD-0.20
Exelon Corp35.07 USD-2.39
Ford Motor Co7.23 USD-0.69
The Western Union Co22.65 USD0.18

About Author

Emma Wall  is former Senior International Editor for Morningstar

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