10 Value Stocks To Invest In Now
A value stock is one that seems to be undervalued based on a combination of factors, such as its valuation history, current stock price, dividend yield, dominant market share and others. Of course, this definition begs the question: Why wouldn’t investors only buy value stocks?
The reason is that so-called “value stocks” aren’t generally newsmakers — some would even classify them as “boring.” Think about the stocks you hear on the financial news all day; typically, they are the exciting, high-flying stocks like Tesla and GameStop that make huge moves. Tesla, for example, gained over 700% in 2020, while GameStop popped over 400% in a single week in early 2021.
Meanwhile, oil and gas companies, utilities and other more traditional companies tend to lumber along under the radar. But that doesn’t mean these names can’t generate big profits. Here’s a look at 10 stocks that can be considered values in today’s market.
1. Rent-A-Center Inc. (RCII)
- Stock price as of May 20: $24.99
Rent-A-Center leases furniture, appliances and electronics to consumers across a network of over 2,000 stores and offers pay later and rent-to-own options. The retailer’s recent acquisition of Acima Holdings, which provides rent-to-own financing at over 15,000 retail stores, should enable Rent-A-Center to expand its partner base.
Analysts reported by Yahoo Finance rate the stock a 1.6 on a scale of 1 (strong buy) to 5 (sell). The average price target is $46.75 in a range of $27 to $72, which is a slight upgrade compared to April and suggests the $24.99 price as of May 20 represents an opportunity to buy a dip.
2. Group 1 Automotive Inc. (GPI)
- Stock price as of May 20: $173.76
Group 1 Automotive operates car dealerships, franchises and collision centers in the U.S., U.K. and Brazil, and it’s been on a buying spree. In the second half of last year, the company announced it would purchase the assets, including 30 stores, of Prime Automotive Group, significantly growing its Northeast U.S. market share.
It also announced the acquisition of two dealerships in the Dallas-Fort Worth market, where it already operated 10 dealerships, according to a press release. And so far in 2022, Group 1 has completed transactions representing at least $550 billion of acquired revenue, Zacks reported, including a Toyota dealership in Albuquerque, New Mexico.
Group 1 could be a great pick because of the company’s solid earnings, positive cash flow — a share repurchase plan and dividend increase were announced last week — and the boost it’s likely to see from a “rising tide” in the automotive retail and wholesale industry overall. Zacks gives it a B grade for momentum, and analysts polled by Yahoo Finance rate it a “buy,” with an average target price of $286.40 — 64% higher than its current price and a 4% upgrade compared to the average target forecast in April.
Group 1 Automotive appears to have plenty of room for continued growth as demand for new and used cars remains high.
3. Honda Motor Co. (HMC)
- Stock price as of May 20: $25.02
Honda announced early in 2021 that it would enter the electric vehicle market, with plans to partner with General Motors to produce two vehicles before venturing off to manufacture its own. Since then, the automaker has announced plans to expedite its “electrification” and roll out 30 EV models worldwide by 2030 and produce over 2 million vehicles annually, according to an April 12 press release.
That move and a plan to partner with GM on low-priced EVs position the company to be a significant force in the growing EV market at a time when high gas prices have consumers looking for ways to save at the pump.
The stock is at its lowest level since 2020 and is selling at just 7.78 times earnings. Despite warnings about increasing costs and lower profits due to ongoing chip shortages and a COVID-19 surge in China, Honda has a “strong buy” rating from Yahoo Finance analysts and an average target price of $32.86.
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4. Meta Platforms Inc. (FB)
- Stock price as of May 20: $193.54
Meta, formerly known as Facebook, has taken a beating over the last six months, and shares are trading at their lowest price in two years. However, despite vulnerabilities such as privacy issues, some believe the recent sell-off is unwarranted because of Meta’s unrivaled dominance as a market leader, Seeking Alpha reported.
Over 3 billion people, representing about 45% of the world’s population, use a Meta social media platform at least once a month. Analysts rate FB a “buy” and predict an average price target of $300.86, which is a slight downgrade compared to April but still well above the stock’s current $193.54 price.
5. CVS Health Corp. (CVS)
- Stock price as of May 20: $94.93
CVS Health is a “boring” retailer/pharmaceutical stock with a pedestrian 15.79 P/E ratio and an attractive 2.32% dividend yield. Analysts have a consensus “buy” rating on the stock with an average price target of $117.74, over 24% above the current share price.
In one sense, investors can rely on CVS being a defensive stock, as consumers will always need drugs and healthcare products in any type of economy, and at-home COVID tests and vaccines are likely to figure prominently for some time to come — a fact reflected in CVS’s first-quarter 2022 earnings and revenue, which beat analysts’ expectations — not to mention the dividend increase that went into effect in February.
A $10 billion stock buyback CVS has in store could also boost prices. However, CVS has a lot riding on its recent acquisition of Aetna and launch of Aetna Virtual Primary Care practices.
6. NRG Energy Inc. (NRG)
- Stock price as of May 20: $45.72
As a utility with a P/E ratio of 2.79 and a 3.06% dividend yield, NRG Energy is clearly categorized as a value stock. After trading down a few percentage points in 2019 and in 2020, the stock had a bumpy ride in 2021 but is up significantly from its low point last fall. NRG is turning its focus toward more futuristic power technologies, and it has room to grow.
Indeed, the stock is on the rise again following its May 6 earnings release, where the company reported earnings and revenue that beat Wall St. Journal estimates. Analysts reported by Yahoo Finance give the stock a “buy” rating and an average price target of $45.45 and a high target of $52.
As the Biden administration pushes forward on its green energy and infrastructure priorities, companies like NRG may be able to expand their reach into new technologies.
7. American Tower Corp. (AMT)
- Stock price as of May 20: $244.28
American Tower Corp. is a name that may not be familiar to casual investors, but it’s been printing money as 5G technology is just beginning to take root across the globe. American Tower has the largest portfolio of broadcast towers in the U.S. and is expanding its wireless infrastructure as demand soars.
American Tower stock, like the market overall, has been volatile this year, but analysts see it making solid gains. The average price target among analysts polled by Yahoo Finance is $291, representing a 19% rise from current levels. The stock also pays a 2.34% dividend yield, helping to keep it in the “value” camp.
8. T-Mobile US Inc. (TMUS)
- Stock price as of May 20: $126.04
T-Mobile is America’s third-largest wireless carrier following its 2020 merger with Sprint. Over the next several years, T-Mobile expects to expand its network capacity and speed by 14 and 15 times, respectively, and provide 5G service to 99% of Americans.
These are lofty goals, to be sure, but the company had its strongest year ever in 2021 and achieved industry-leading momentum in wireless, according to a statement accompanying the earnings release for the fourth quarter. A upgraded average price target of $166.57 supports analysts’ “strong buy” consensus.
9. Exxon Mobil Corp. (XOM)
- Stock price as of May 20: $91.86
Big oil companies are prototypical value stocks, as they generally trade at low multiples and pay high dividends. But ExxonMobil was already on the move when winter set in last year, and the momentum has continued amid the ban on Russian oil due to that country’s invasion of Ukraine.
Oil and gas prices hit multiyear highs in March, boosting earnings across the energy industry. ExxonMobil’s stock is up almost 45% since the beginning of the year and is paying a hefty 3.83% dividend. Although XOM is trading at its highest price in over five years, there could still be plenty of value left if Western nations continue or increase their sanctions on Russia.
10. Crown Holdings Inc. (CCK)
- Stock price as of May 20: $101.08
Analysts are bullish on Crown Holdings, with a “strong buy” rating and an average target of $142.53 based on a range of $123 to $165. The stock is down slightly compared to a year ago, but first-quarter earnings and sales were up year-over-year and came out ahead of analysts’ estimates.
Crown Holdings is a leader in packaging for consumer goods, particularly metal packaging, with operations in 47 countries and net sales of $3.16 billion during the first quarter of 2022 compared to $2.564 billion for the same quarter a year prior. Analysts rate CCK a “strong buy.”
Daria Uhlig contributed to the reporting for this article.
Data is accurate as of May 20, 2022, and is subject to change.
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- American Honda Motor Co. 2022. "Summary of Honda Briefing on Automobile Electrification Business."
- CNBC. 2022. "GM, Honda join forces to develop low-price electric vehicles."
- CNBC. 2022. "CVS fourth-quarter earnings top expectations as Covid vaccines lift overall store sales."
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- The San Diego Union-Tribune. 2022. "Under Armour, Dish fall; Cigna, NRG Energy rise."