Intensifying geopolitical tensions, worsening supply chain conditions, and the possibility of a recession due to the Fed's tightening of monetary policy have led to the stock market experiencing a massive sell-off over the past few weeks. The market is expected to remain turbulent ahead of the fresh inflation data. According to economists, high inflation reading is expected, but it should be moderate from the 8.5% year-over-year pace of March.
In addition, last week, the Nasdaq Composite lost 1.54%, while the S&P 500 and Dow plunged 0.21% and 0.24%, respectively. According to Bank of America, the S&P 500's massive sell-off in the past week has increased this year's correction for the broad index, and it's likely to sink even lower before finding a bottom and rebounding. However, the market downtrend has led to many quality stocks trading at attractive valuations. Since value stocks tend to outperform in an inflationary environment, it could be an opportune time for investors to invest in such stocks.
That’s why today we're highlighting 3 exciting stocks from our Top 10 Value screen, which is just 1 of the 10 screens in our POWR Screens 10 service (more on that below). Bluegreen Vacations Holding Corporation (BVH), Village Super Market, Inc. (VLGEA), and Lincoln Educational Services Corporation (LINC) are currently trading at a discount to their peers despite possessing solid fundamentals. These stocks are rated Strong Buy in our POWR Ratings system. So, these stocks could be great additions to your portfolio.
Bluegreen Vacations Holding Corporation (BVH)
BVH functions as a vacation ownership company and markets and sells vacation ownership interests (VOI); and manages resorts in leisure and urban destinations, including Orlando, Las Vegas, Myrtle Beach, Charleston, New Orleans, and others.
In terms of forward P/E, BVH is trading at 7.81x, 51.5% lower than the 16.09x industry average. Also, in terms of Price/Sales, the stock is currently trading at 0.70x, 72.5% lower than the 2.55x industry average.
BVH's total revenue increased 33.3% year-over-year to $195.13 million for the first quarter ending March 31, 2022. The net income grew 437.6% from its year-ago value to $15.99 million, while its adjusted EBITDA came in at $31.06 million representing a 144.1% increase year-over-year. The company's EPS rose 406.7% from its year-ago value to $0.76. The stock has gained 46.2% over the past year.
BVH's POWR Ratings reflect this promising outlook. The company has an overall rating of A, which translates to Strong Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
BVH is also rated an A grade for Value and Sentiment and a B for Growth. Within the Travel - Hotels/Resorts industry, it is ranked #1 of 22 stocks. To see additional POWR Ratings for Quality, Stability, and Momentum for BVH, click here.
Village Super Market, Inc. (VLGEA)
Headquartered in Springfield, New Jersey, VLGEA functions as a chain of supermarkets in the United States. Its stores feature specialty departments, such as an on-site bakery, an expanded delicatessen; and various natural and organic foods, ethnic and international foods, prepared foods, and pharmacies.
In terms of trailing-12 months EV/Sales, VLGEA is trading at 0.29x, which is 83.5% lower than the 1.76x industry average. Also, in terms of its trailing-12 month Price/Sales, the stock is currently trading at 0.16%, 87.2% lower than the 1.23% industry average.
For the second quarter ended January 29, 2022, VLGEA's sales increased 2.8% year-over-year to $537.41 million. The operating income grew 122.1% from its year-ago value to $14.66million, while its net income improved 122.4% from its prior-year quarter to $10.13 million. The company's EPS grew 117.4% year-over-year to $0.50.
The company's shares have surged 1.9% over the past three months.
VLGEA's strong fundamentals are reflected in its POWR Ratings. The stock has an overall A rating, which equates to Strong Buy in our POWR Ratings system. The stock also has an A grade for Value and a B for Quality and Stability. In the A-rated Grocery/Big Box Retailers industry, it is ranked #5 of 38 stocks.
In total, we rate VLGEA on eight different levels. Beyond what we've stated above, we have also given VLGEA grades for Growth, Momentum, and Sentiment. Get all the VLGEA ratings here.
Lincoln Educational Services Corporation (LINC)
Headquartered in Parsippany, New Jersey, LINC and its subsidiaries provide various career-oriented post-secondary education services to high school graduates and working adults in the United States. The company has two operational segments: Transportation and Skilled Trades and Healthcare and Other Professions.
In terms of forward Price/Book, LINC is trading at 1.01x, 57.7% lower than the 2.38x industry average. Also, in terms of its trailing-12 months EV/Sales, the stock is currently trading at 0.60x, which is 45.7% lower than the 1.10x industry average.
During the fourth quarter ending December 31, 2021, LINC's revenue increased 7.4% year-over-year to $87.82 million. The operating income grew 206% from its year-ago value to $34.05 million, while the net income amounted to $23.96 million. The company's EPS came in at $0.73.
The consensus EPS estimate of $0.20 for the third quarter ending September 2022 represents an 84.9% improvement year-over-year. Analysts expect LINC's revenue to increase 5.2% year-over-year to $82.03 million in the first quarter ending March 2022. Moreover, it has an impressive earnings surprise history, as it surpassed the consensus EPS estimates in all of the trailing four quarters. The stock has soared 1.3% over the past month.
It is no surprise that LINC has an overall A rating, which equates to Strong Buy in our POWR Ratings system. LINC has an A grade for Value and Sentiment and a B grade for Stability.
Among the 22 stocks in the B-rated Outsourcing - Education Services industry, it is ranked #1. Click here to see the additional POWR Ratings for LINC (Growth, Quality, and Momentum).
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BVH shares were trading at $24.45 per share on Monday morning, down $1.83 (-6.96%). Year-to-date, BVH has declined -29.95%, versus a -15.31% rise in the benchmark S&P 500 index during the same period.
About the Author: Spandan Khandelwal
Spandan's is a financial journalist and investment analyst focused on the stock market. With her ability to interpret financial data, she aims to help investors evaluate the fundamentals of a company before investing.
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