Singaporean social media services provider Joyy Inc. (YY) is at the top of the list for undervalued non-penny stocks trading below $50 per share, based on a price-to-book ratio of just 0.38.
A low price-to-book ratio may be an indication that a company's stock is undervalued relative to the market. Below, we look closely at undervalued stocks under $50 across each sector for March 2024. Our screen includes companies listed on the New York Stock Exchange (NYSE) or the Nasdaq with positive one-year total returns and the lowest price-to-book ratios. We focus on affordable stocks trading below $50, but we have not included penny stocks in this screen.
All data below are as of March 6, 2024.
Key Takeaways
- A company's price-to-book ratio measures its market price per share as compared with its book value per share.
- Lower price-to-book ratios may indicate companies that are undervalued, making them a prime target for value investors.
- Value investors believe that the market will eventually correct pricing of undervalued stocks, providing an opportunity for those who have invested previously to generate a profit.
- The top undervalued, non-penny stocks on the NYSE or the Nasdaq for March 2024 that trade below $50 per share include Joyy, Ebang International Holdings, STRATTEC Security, Central Plains Bancshares, EuroDry, Landsea Homes, Viatris, Alico, Universal Stainless & Alloy Products, EQT, and Consolidated Water Co.
Joyy Inc. (YY)
- Price-to-book ratio: 0.38
- Price: $31.84
- Market capitalization: $2.0 billion
- Sector: Communication services
- 1-Year total return: 0.7%
Joyy is a Singaporean global tech firm operating social media platforms including Bigo Live for livestreaming, Likee for videos, Hago for social networking, and more. In its last fiscal report, for the third quarter of 2023, Joyy reported a marginal decline in revenues year-over-year, even as global average mobile monthly active users climbed by 2.6%.
Ebang International Holdings Inc. (EBON)
- Price-to-book ratio: 0.43
- Price: $10.59
- Market capitalization: $69.3 million
- Sector: Information technology
- 1-Year total return: 53.3%
Ebang is a Chinese technology company that researches and develops chip technology for use in blockchain applications as well as cryptocurrency mining hardware. In its most recent fiscal report, for the first half of fiscal year 2023, Ebang reported narrowing net losses and an 84% year-over-year decrease in net revenues.
STRATTEC Security Corp. (STRT)
- Price-to-book ratio: 0.52
- Price: $24.90
- Market capitalization: $101.3 million
- Sector: Consumer discretionary
- 1-Year total return: 18.5%
STRATTEC provides vehicle power access solutions for sliding doors, tailgates, endgates, and other equipment. It also offers electronic and security solutions.
Price-to-book ratio compares a company's market capitalization to its book value. It is calculated by dividing market price per share by book value per share. A stock with a price-to-book ratio under 1.0 may appeal to value investors as potentially undervalued.
Central Plains Bancshares Inc. (CPBI)
- Price-to-book ratio: 0.54
- Price: $10.21
- Market capitalization: $42.2 million
- Sector: Financials
- 1-Year total return: 23.8%
Central Plains Bancshares is a financial holding company. It is the parent company of Home Federal Savings & Loan Association of Grand Island, a regional bank operating throughout parts of the Midwest. The company has yet to provide a quarterly earnings report, as it only began trading publicly in October of last year.
EuroDry Ltd. (EDRY)
- Price-to-book ratio: 0.59
- Price: $22.70
- Market capitalization: $64.3 million
- Sector: Industrials (Transportation)
- 1-Year total return: 26.8%
EuroDry is a Greek dry cargo and drybulk shipping company. It operates a fleet of about 13 vessels around the globe. The company announced in November that it had taken delivery of M/V Maria, an Ultramax drybulk carrier and the latest addition to its fleet.
Landsea Homes Corp. (LSEA)
- Price-to-book ratio: 0.69
- Price: $12.32
- Market capitalization: $445.1 million
- Sector: Real estate
- 1-Year total return: 81.2%
Landsea Homes is a residential homebuilder that focuses on master-planned communities. It has developed homes throughout the country, particularly in the northeastern U.S. and California. Most recently, Landsea announced that it had begun development on a community of over 200 homes in Kyle, Texas.
Viatris Inc. (VTRS)
- Price-to-book ratio: 0.72
- Price: $12.20
- Market capitalization: $14.5 billion
- Sector: Healthcare
- 1-Year total return: 12.2%
Viatris is a healthcare company providing medicines to treat a wide variety of conditions and diseases in both branded and generic forms. The company's brands include Lipitor, Zoloft, Xanax, and Viagra.
Alico Inc. (ALCO)
- Price-to-book ratio: 0.72
- Price: $27.11
- Market capitalization: $206.6 million
- Sector: Consumer staples
- 1-Year total return: 4.0%
Alico is one of the largest citrus-growing agribusinesses in the U.S., operating about 69,000 acres of land in Florida. The company reported net income attributable to shareholders of about $43 million in the most recent quarter, compared with a net loss during the same quarter in 2022.
- Price-to-book ratio: 0.86
- Price: $20.98
- Market capitalization: $190.7 million
- Sector: Materials
- 1-Year total return: 122.7%
Universal Stainless is a manufacturer of semi-finished and finished steel products. Its offerings include stainless steel, tool steel, and other alloyed steels for a variety of end uses. The company recently announced a price increase of between 7% and 12% on its premium products.
EQT Corp. (EQT)
- Price-to-book ratio: 1.07
- Price: $37.68
- Market capitalization: $16.6 billion
- Sector: Energy
- 1-Year total return: 14.4%
EQT is an independent natural gas production company that centers its operations in the Marcellus and Utica shales in the Appalachian basin.
Consolidated Water Co. Ltd. (CWCO)
- Price-to-book ratio: 2.62
- Price: $29.63
- Market capitalization: $466.6 million
- Sector: Utilities
- 1-Year total return: 92.4%
Consolidated Water develops advanced water supply and treatment plants in the U.S. as well as the Cayman Islands, The Bahamas, and the British Virgin Islands. The company recently announced a quarterly cash dividend of $0.095 per share, payable on April 30.
How We Selected Undervalued Stocks
Our screen for undervalued stocks includes companies listed on the Nasdaq or the NYSE that are trading between $10 and $50 per share and that had positive total returns for the trailing 12-month period. We ranked those firms by the lowest price-to-book ratio, calculated by dividing the market price per share by the book value per share, and selected the top company for each GICS sector.
Stocks with price-to-book ratios lower than 1 are generally considered to be undervalued. Along with metrics like price-to-earnings ratio, price-to-book is one of the key measures that value investors use to identify potential stocks for investment.
Successful value investors buy undervalued stocks, which later rise in price to reflect the true value of the associated companies. Particularly for undervalued stocks trading at less than $50 each, this is an accessible investment strategy for many investors. A variety of online brokers and other options make targeting these stocks easy. Investors can then wait to see if and when the price of a stock rises to reflect its underlying value.
However, there are risks to focusing on undervalued stocks. A single metric like price-to-book, while helpful, does not always give a complete picture of whether a stock is undervalued or overvalued. Similarly, there is no guarantee that the market will correct the price of undervalued stocks in any particular timeframe or even at all.
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As of the date this article was written, the author does not own any of the above stocks.
