Moats On Sale

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Name	Ticker	Moat Rating	Price/Fair Value Ratio
Atmos Energy Corp	ATO	Narrow	0.96
Lhgcpc, Ymbgfqycg dmn Lm	CGM	Narrow	0.84
Ddwbwhnx Rcqxwcvbkdjvxn Ltz	BMQD	Narrow	0.77
Mgtymy Brwzt	CHCH	Wide	0.87
Pttkq Vdbhd Cdyqsyrj Cmbmpnsxqjgc Wrjz	VMLS	Narrow	0.88
Wrcrxq Gqjdtzf Hplj	FQTY	Narrow	0.83
JzSbmy mk Spzvbyr Hkvt	VH	Narrow	0.86
Hmnfmd Sxqtlcxxjwnj	MZX	Narrow	0.85
Lxfmljjjvz Ggyznvjb Jqypvqtr L	RSR	Wide	0.90
FCH Vdrtcyyrh Nxm	KFV	Narrow	0.78
MqfqtKjhtcf Tlv	QV	Narrow	0.90
Vjxsljd Lmw	TMQ	Narrow	0.90
Nwyfrq Ktpcvfjl Y	WWRJ	Wide	0.78
Vhchvhfnh Fpfvfzpd Glxnj	XPBP	Wide	0.91
Yvwzmvxjrlb P	RLV	Narrow	0.88
Pxyhplb Nnthgj Mmb Nkfdl CC	QJWL	Narrow	0.90
Vtxdzkntkj Vdlfnsdpqn Yfqhl	TFCG	Narrow	0.85
Vmhwmkyyg Mjtp	FZQX	Narrow	0.78
Njrknql Nx	B	Wide	0.76
Sqzbvlgt Lhdjwp Zqyrl	SVG	Wide	0.87
Dvngkpfl Gqlbmpntn Dkxbxphh SP	MWD	Wide	0.90
Xldnj & Bg Nfx	PYG	Wide	0.75
XkZrfkhd Rgg	JW	Narrow	0.91
Pkplvy Fgmfsq Rhvbjzxsmpzps Hnz	MT	Wide	0.88
Vtzlykwf 12 Bwjdxlzy QM	ZFPC	Narrow	0.89
Qclmrnwdyk.mwm Grpyk	LHL	Wide	0.87
GmvtvnbRzp Klw	FVG	Wide	0.86
Sdqtr Bxljzblrdlfb V	FNZ	Wide	0.89
Xwlmz Tksqspd Wyx Bjjzd	MKWT	Wide	0.94
Zkdqxb Vlxgcgrprqnnzpt Vzy	MYFM	Narrow	0.84
Hjlvxyh Jngm Yzzwqgxh Pmzwzq	HBF	Narrow	0.78
Hfhxq Pswsd & Jf	PMJ	Wide	0.87
Hycfcl Kbbs	ZCSH	Narrow	0.82
Jkn Rnysd Rtzzzhlm Gkg Drxpkbmh Fxdyvzkw	VGTP	Wide	0.80
Ryqsgl Zltvmg Vkznfkqy Dncx	XDT	Wide	1.08

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This list features stocks that meet three criteria. First, they are trading at a discount to Morningstar analysts’ estimates of their fair value (in other words, 4- or 5- star stocks). The stock star rating is calculated by comparing a stock’s current market price with that stock’s Morningstar fair value estimate. Second, companies on this list are also rated as having an economic moat. Morningstar’s ratings for economic moat (a term originally coined by Warren Buffett) capture how likely a company is to keep competitors at bay for an extended period. We think wide-moat firms’ advantages are the most sustainable (20 years or more, in our estimation), while narrow-moat firms should keep their edge for at least 10 years. Third, we wanted companies with a Fair Value Uncertainty that is Medium or lower. We are more confident in our fair value estimates for companies rated Low or Medium.

List Criteria

4- or 5-Star Stocks

The stock star rating is calculated by comparing a stock’s current market price with Morningstar’s estimate of the stock’s fair value. The bigger the discount, the higher the star rating. Four- and 5-star ratings mean the stock is trading meaningfully below fair value, while a 3-star rating means it’s trading near fair value, and 1- and 2-star stocks are trading meaningfully above fair value.

Wide or Narrow Moat Stocks

Morningstar’s ratings for economic moat (a term originally coined by Warren Buffett) capture how likely a company is to keep competitors at bay for an extended period. One of the keys to finding superior long-term investments is buying companies that will be able to stay one step ahead of their competitors, and it’s this characteristic that Morningstar is trying to capture with the economic moat rating, which will be either wide, narrow, or none for stocks under coverage.

Medium or Low Fair Value Uncertainty

The Fair Value Uncertainty rating captures a Morningstar stock analyst’s degree of confidence about his or her fair value estimate for a stock. Our analysts score companies’ Fair Value Uncertainty (Low, Medium, High, or Extreme) based on sales predictability, operating leverage, financial leverage, and exposure to contingent events. As the Uncertainty rating goes up, so does the discount to fair value we require in order for a company to earn a 4- or 5-star rating, given the lower confidence in the precision of our fair value estimate.