Few people will argue that the current market is frothy.

Economic numbers look encouraging, but there are significant underlying issues that no one is interested in discussing. For instance, tens of millions of Americans are unemployed, yet no relief is coming from Congress.

And what about the fact that the pandemic hardly seems under control but millions of children will be back in classrooms in the coming weeks. Plus, the numbers we’re currently seeing are in the summer months, when the novel coronavirus was supposed to go away.

But the market is climbing this wall of worry, so instead of hiding from it, the smart approach is to find the stocks of companies that have found a way to thrive. Where exactly should you start?

Laura Gonzalez, an associate professor of finance at California State, Long Beach, told InvestorPlace that the key in finding value stocks now is all about the longer-term story.

“[Warren] Buffett interviews a wide range of stakeholders to find out not just about competitive advantages, but also the corporate culture, governance and efficient independent frugal innovative leadership. We also need to keep in mind [how] the society and world are changing towards a new normal as a result of [Covid-19].”

Taking into consideration how the world is changing — and understanding the big picture behind each company — can help you determine if a stock is undervalued.

The five fantastic value stocks below are still trading at decent valuations. But more importantly, they all have big potential as the economy soars — or skids — forward.

• Thor Industries (NYSE:THO)
• AllianceBernstein (NYSE:AB)
• KAR Auction Services (NYSE:KAR)
• Compass Diversified Holdings (NYSE:CODI)
• Hercules Capital (NYSE:HTGC)

Value Stocks: Thor Industries (THO)

Summer holidays were significantly different this year. Air travel, hotel bookings and dining out became high-risk activities. And they remain so, as long as Covid-19 numbers remain high.

But that doesn’t mean people haven’t had the travel bug. And that’s where THO comes in.

It’s one of the nation’s leading mobile home manufacturers. Whether it’s a towable (an Airstream trailer for example) or a motor coach (like an Entegra), THO makes it.

And this isn’t just about people buying a recreational vehicle, it’s about the huge market for rentals that has cropped up as people look to find a safe way to travel.

THO stock is up nearly 150% in the past year, but its price-earnings ratio is now about the average for the S&P 500. And its price-book value is almost half the S&P 500 average at 1.7 times.

It also delivers a 1.5% dividend, which might not be much, but it is certainly better than what you’re going to get in a money market account.

AllianceBernstein (AB)

If you’re a well-read investor, this name might ring a bell. AllianceBernstein is an asset management company that offers investment management vehicles and trusts for all sorts of individual and institutional investors.

You can buy mutual funds, closed-end funds, hedge funds and various other products that AB owns manages. It also manages accounts for investors.

One unique aspect of AB is that it’s set up as a limited partnership, which makes stockholders owners, so profits from net income are distributed on quarterly basis.

Currently the stock is paying a hefty 9.3% dividend.

Assets under management, a key indicator of the company’s growth, continue to rise. Yet it trades at a P/E about one third of the S&P 500 average and its price-book value is also very low. The stock is up 8% in the past 12 months, but the dividend is a big kicker.

Value Stocks: KAR Auction Services (KAR)

If the name hasn’t given away this company’s business model, KAR is an automotive auction site.

But this isn’t just about selling old jalopies or classic cars. It’s about the much bigger picture.

KAR has operations in the United States, Canada, Mexico and Europe. And it sold 3.8 million vehicles last year, for about $40 billion in revenue.

While the U.S. may be awash in cars and trucks, there are a lot of places where cars aren’t readily available. Europe and the U.S. can sell cars into South America and Africa, two massive markets for used cars.

Also, many companies can buy fleet cars using KAR’s services.

And auction services are in high demand when markets are transitioning. In bad times, it’s a way to offload assets you don’t need or buy assets cheaply. In good times, it’s a way to expand quickly or upgrade prudently.

KAR’s current P/E is about 12 times. Its price-book is 1.7 times, and its price-sales ratio is a mere 1 times. Compare that to an average S&P 500 P/E of  29 times.

The stock is off about 30% in the last year due to chaos in the automotive sector, but it’s gaining ground again. It’s up 52% in the past three months.

Value Stocks: Compass Diversified Holdings (CODI)

Because CODI is structured as a investment holding company under the Investment Companies Act of 1940, it avoids corporate income taxes, so it can pay a generous dividend.

In this case, that dividend is 8.3%.

It’s what I like to call an alt-financial company. When the markets melted down in 2008, a lot of new companies sprouted up to offer financing to businesses when the banks were too scared to risk loans.

CODI put together a portfolio of small- to mid-sized industrial and consumer companies. It essentially operates like a small Berkshire Hathaway (NYSE:BRK.A, NYSE:BRK.B). It finances these companies, taking ownership, board or stock positions, and then either takes them public or spins them off to a suitor at a premium.

Because these types of firms don’t operate under the onerous regulations that traditional financial institutions do, they can be more creative with their deals and move much faster.

CODI only has a $1.1 billion market capitalization, but it’s growing at a solid clip. It has tons of cash ready to deploy — the current ration is 300% of current liabilities — and it’s trading at significant discounts to book value and sales.

The stock is off 7% in the past year due to pandemic concerns but it’s regained much of that. It is on track to growth once again.

Hercules Capital (HTGC)

Another alt-financial, HTGC operates a business development corporation under the same type of structure as CODI.

One key difference is that HTGC is focused on the tech space and operates more as a venture capital company, providing seed capital to businesses with promising tech solutions. Since its inception in 2003, it has worked with more than 500 companies.

It is currently working with a number of well-known tech companies — from DocuSign (NASDAQ:DOCU) to FanDuel to Impossible Foods — but over half its current portfolio is in life sciences companies.

And this was true even before Covid-19. Life sciences is one of those major macroeconomic trends that will grow regardless of events like the pandemic.

Also, its tech focus also means that the company is set to profit from the enormous shift working and learning from home that is currently happening.

The stock was hit when the markets tanked in late March, given its exposure to small and medium-sized business that have to navigate the current landscape.

But it’s off less than 10% and its whopping 11% dividend covers that. HTGC has a super-low P/E of 13 times and price-book of 1.3 times, significantly lower than the S&P 500.

Neil George was once an all-star bond trader, but now he works morning and night to steer readers away from traps — and into safe, top-performing income investments. Neil’s new income program is a cash-generating machine … one that can help you collect $208 every day the market’s open. Neil does not have any holdings in the securities mentioned above.