Wall Street Experts: UBS Analysts Love These 10 Undervalued Stocks

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(List compiled by Eben Esterhuizen, CFA)

A sell side analyst produces detailed research that is circulated to broker clients for investment considerations. When research is distributed from a reliable analyst it can prove influential in changing investors’ perceptions and driving share prices.

Researches often cover a specific industry or sub-sector in order become experts in their field. Their advanced knowledge helps them to utilizes complex forecast models and ultimately deliver recommendations on stocks or other securities.

The recommendations are typically phrased as “buy,” “sell,” or “hold.”

 

Business Section: Investing Ideas

Interested in tracking the recommendations of top Wall Street analysts?

To help you get started, we did a screen on all the stocks that UBS ranked as a “Buy” over the last 12 months. To refine the list, we collected data on levered free cash flows, and identified the names that are most undervalued relative to enterprise value.

UBS analysts are optimistic on the prospect of these undervalued stocks–do you agree with their bullish sentiment?

Analyze These Ideas (Tools Will Open In A New Window)

1. Access a thorough description of all companies mentioned
2. Compare analyst ratings for all stocks mentioned below
3. Visualize annual returns for all stocks mentioned

List sorted alphabetically.

1. Agilent Technologies Inc. (A): Provides bio-analytical and electronic measurement solutions to the communications, electronics, life sciences, and chemical analysis industries in the United States and internationally. On 10/24/2011, UBS had a Buy rating on the stock. Levered free cash flow at $2.24B vs. enterprise value at $10.53B (implies a LFCF/EV ratio at 21.27%).

2. Accenture plc (ACN): Operates as a management consulting, technology services, and outsourcing company. On 05/16/2011, UBS had a Buy rating on the stock. Levered free cash flow at $3.42B vs. enterprise value at $29.12B (implies a LFCF/EV ratio at 11.74%).

3. The Allstate Corporation (ALL): Engages in the personal property and casualty insurance, life insurance, retirement, and investment products businesses primarily in the United States. On 08/10/2011, UBS had a Buy rating on the stock. Levered free cash flow at $1.59B vs. enterprise value at $15.05B (implies a LFCF/EV ratio at 10.56%).

4. Cliffs Natural Resources Inc. (CLF): Produces iron ore pellets, lump and fines iron ore, and metallurgical coal products. On 06/13/2011, UBS had a Buy rating on the stock. Levered free cash flow at $1.48B vs. enterprise value at $12.51B (implies a LFCF/EV ratio at 11.83%).

5. Cisco Systems, Inc. (CSCO): Designs, manufactures, and sells Internet protocol (IP)-based networking and other products related to the communications and information technology industry worldwide. On 10/27/2011, UBS had a Buy rating on the stock. Levered free cash flow at $8.38B vs. enterprise value at $70.09B (implies a LFCF/EV ratio at 11.96%).

6. Dana Holding Corporation (DAN): Engages in the design, manufacture, and supply of products for vehicle manufacturers worldwide. On 11/22/2011, UBS had a Buy rating on the stock. Levered free cash flow at $206.62M vs. enterprise value at $1.75B (implies a LFCF/EV ratio at 11.81%).

7. Hewlett-Packard Company (HPQ): Hewlett-Packard Company offers various products, technologies, software, solutions, and services to individual consumers and small- and medium-sized businesses (SMBs), as well as to the government, health, and education sectors worldwide. On 01/11/2011, UBS had a Buy rating on the stock. Levered free cash flow at $8.59B vs. enterprise value at $72.56B (implies a LFCF/EV ratio at 11.84%).

8. Ingersoll-Rand Plc (IR): Engages in the design, manufacture, sale, and service of a portfolio of industrial and commercial products in the United States and internationally. On 09/06/2011, UBS had a Buy rating on the stock. Levered free cash flow at $1.19B vs. enterprise value at $11.69B (implies a LFCF/EV ratio at 10.18%).

9. Monster Worldwide, Inc. (MWW): Provides online employment solutions worldwide. On 06/17/2011, UBS had a Buy rating on the stock. Levered free cash flow at $92.01M vs. enterprise value at $847.49M (implies a LFCF/EV ratio at 10.86%).

10. Shaw Group Inc. (SHAW): Provides technology, engineering, procurement, construction, maintenance, fabrication, manufacturing, consulting, remediation, and facilities management services to multinational and national oil companies, industrial corporations, regulated utilities, independent and merchant power producers, and government agencies worldwide. On 02/08/2011, UBS had a Buy rating on the stock. Levered free cash flow at $195.02M vs. enterprise value at $1.51B (implies a LFCF/EV ratio at 12.92%). 



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Investing Ideas , Stocks , US Markets


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