With thousands of publicly traded companies to choose from, it’s inevitable that a few will make the rounds of overlooked value stocks. These enterprises represent businesses that trade at an attractive multiple to a key financial. In this case, that would be earnings on a trailing-12-month basis. However, anybody can come up with a list of securities that present themselves as overlooked value stocks but end up being bull traps. To help lessen the risk of this circumstance materializing, all these companies feature an optimistic view by Wall Street analysts.
Better yet, their collective price targets imply an average upside potential of over 109%. Do I have your attention now? Good! Below are seven overlooked value stocks that could (easily) outperform the market.
| IMXI | International Money Express | $24.14 |
| AMR | Alpha Metallurgical | $158.05 |
| SIMO | Silicon Motion | $65.70 |
| AMRK | A-Mark Precious Metals | $29.23 |
| SRTS | Sensus Healthcare | $7.08 |
| ADTH | AdTheorent Holding | $1.69 |
| CMRX | Chimerix | $1.73 |
International Money Express (IMXI)
Based on sheer performance, International Money Express (NASDAQ:IMXI) might not exactly be overlooked. A fast and reliable money transfer system, the platform offers significant relevancies. Moreover, in the trailing year, IMXI gained more than 52% of equity value. Nevertheless, it’s not exactly a household name. Currently, it features a market capitalization of just over $873 million.
Still, IMXI is well worth consideration for overlooked value stocks to buy. Currently, the market prices IMXI at a trailing multiple of 16.03. As a discount to earnings, International Money Express ranks better than 73% of the competition. In addition, IMXI trades hands at 11.15-times forward earnings. This rates well below the sector median of 26.46 times.
Turning to Wall Street, covering analysts peg IMXI as a consensus strong buy. Most recently, JMP Securities reiterated its “buy” assessment, along with a price target implying 14.6% upside. Overall, the average price target stands at $28.67, implying upside potential of nearly 22%.
Alpha Metallurgical Resources (AMR)
Headquartered in Bristol, Tennessee, Alpha Metallurgical Resources (NYSE:AMR) is a leading coal supplier with underground and surface coal mining complexes across Northern and Central Appalachia. Given the political framework moving rapidly toward zero-emission initiatives, AMR might seem anachronistic. Therefore, it ranks among the overlooked value stocks but in a positive context.
Although Gurufocus.com warns that Alpha Metallurgical represents a significantly overvalued investment, objectively, the data suggests something different. Currently, the market prices AMR at a trailing multiple of 2.03. As a discount to earnings, Alpha ranks better than 95.53% of sector peers. Also, AMR trades at 2.25-times free cash flow (FCF), whereas the industry median stands at 7.9 times.
Further, the company enjoys a massive cash war chest and a strong net margin of over 36%. These stats should entice contrarians to consider it one of the overlooked value stocks to buy. On Wall Street, analysts peg AMR as a consensus moderate buy. Their average price target stands at $201, implying upside potential of nearly 27%.
Silicon Motion Technology (SIMO)
An American-Taiwanese technology firm, Silicon Motion Technology (NASDAQ:SIMO) develops NAND flash controller integrated circuits for solid-state storage devices. Like many other tech firms, 2022 imposed a rough environment for SIMO. In the trailing year, shares gave up nearly 13% of equity value. However, since the Jan. opener, SIMO gained almost 3%.
For bargain hunters, Silicon Motion presents a very attractive canvas. Presently, the market prices SIMO at a trailing multiple of 3.18 times. As a discount to earnings, Silicon ranks better than 77.17% of sector rivals. Moreover, SIMO trades at a forward multiple of 14.62 times, ranked much lower than the sector median of 20.81 times.
On the balance sheet, the company features zero debt on its books, affording it incredible flexibility. Operationally, it has outstanding revenue growth and solid profitability metrics. Finally, Wall Street analysts peg SIMO as a consensus strong buy. Further, their average price target stands at $95.75, implying upside potential of over 45%. Thus, SIMO represents an enticing option among overlooked value stocks to buy.
A-Mark Precious Metals (AMRK)
A precious metals trading company, A-Mark Precious Metals (NASDAQ:AMRK) really should get more attention. After all, despite recent hiccups, the precious metals market went bonkers this year. Nevertheless, AMRK continues to be one of the overlooked value stocks. For instance, in the trailing year, shares fell more than 21%. And in the year so far, AMRK slipped over 14%.
However, astute contrarians will probably eyeball A-Mark as a bargain upside opportunity. Presently, the market prices AMRK at a trailing multiple of 4.72. As a discount to earnings, A-Mark ranks better than 88.93% of industry players. Also, AMRK trades at 3.23-times forward earnings. In contrast, the sector median stands at 13.76 times.
Notably, A-Mark benefits from a decently stable balance sheet. Operationally, the company commands a strong book growth rate and outstanding return on equity. Lastly, Wall Street analysts regard AMRK as a consensus moderate buy. Moreover, their average price target pings at $53, implying 80% upside potential. Therefore, it’s a tempting candidate for overlooked value stocks to buy.
Sensus Healthcare (SRTS)
A medical technology firm, Sensus Healthcare (NASDAQ:SRTS) specializes in superficial radiation therapy (SRT), which requires minimal to no cutting. As well, the process involves no scarring and no down time, according to Sensus’ website. Although scientifically relevant, SRTS encountered some volatility in 2022. During the trailing year, SRTS gave up nearly 14% of equity value.
Nevertheless, contrarian investors may see the long-term viability of the underlying innovation. Currently, the market prices SRTS at a trailing multiple of 4.82. As a discount to earnings, Sensus ranks better than 94.54% of medical device and instrument firms. In addition, SRTS trades at 5.92-times forward earnings. For comparison, the industry median pings at 26.46 times.
Aside from SRTS ranking among the overlooked value stocks, Sensus enjoys excellent strengths in the balance sheet. On the bottom line, the company commands outstanding profitability margins. Pointing to Wall Street, analysts peg SRTS as a consensus strong buy. Further, their average price target of $14.67 implies upside potential of over 108%.
AdTheorent Holding (ADTH)
A technology firm, AdTheorent Holding (NASDAQ:ADTH) leverages machine learning and data science to deliver real-world value for advertisers and marketers. Fundamentally, ADTH became one of the overlooked value stocks in part because of the erosion of the digital advertising industry. Not surprisingly, then, ADTH took a beating. In the trailing year, shares gave up 76% of equity value.
Despite the unsightly losses, AdTheorent could rank among the overlooked value stocks to buy. Mainly, at some point, businesses will have to advertise their ware; otherwise, they’ll lose out to the competition. Plus, ADTH offers an attractive (albeit speculative) investment. Right now, the market prices shares at a trailing multiple of 3.55. As a discount to earnings, AdTheorent ranks above 94.51% of sector peers. Finally, Wall Street analysts peg ADTH as a consensus strong buy. Moreover, their average price target stands at $3.63, implying upside potential of over 117%.
Chimerix (CMRX)
Based in North Carolina, Chimerix (NASDAQ:CMRX) specializes in a new class of cancer therapies. According to the company’s website, Chimerix aims to develop medicines that meaningfully improve and extend the lives of patients facing deadly diseases. Although it presents a feel-good narrative, clinical disappointments led to a sharp erosion of value.
Nevertheless, those that want to take risks with their overlooked value stocks may have an intriguing candidate with CMRX. Presently, the market prices shares at a trailing multiple of 1.0. As a discount to earnings, Chimerix ranks better than 97.55% of the competition. Also, CMRX trades at 0.55-times book value. In contrast, the sector median is 2.45 times.
Among other attributes, Chimerix enjoys a very strong cash balance. As well, it features outstanding net margins, though it might not be able to maintain its mercurial pace. Despite challenges, Wall Street analyst remain bullish on CMRX, pegging it a consensus moderate buy. Further, their average price target stands at $8, implying over 365% upside potential.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
