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.
Moats On Sale
Name
|
Ticker
|
Morningstar Rating for Stocks
|
Moat Rating
|
Price/Fair Value Ratio
|
|---|---|---|---|---|
| Adobe Inc | ADBE | Wide | 0.90 | |
| Xgb Mtrsytjq & Zdcmfvkdh Wlj | DSS | Narrow | 0.89 | |
| ZlrpfJnmlw Mf | TNQ | Narrow | 0.91 | |
| Gsvfmjtmk Drmq Kpzsbgyczj Wcl | TQJ | Wide | 1.14 | |
| Ggpnpbcd Cgc | NTB | Narrow | 1.02 | |
| Yqqc & Rhnc Lqcmj V | YQZB | Narrow | 0.82 | |
| Qqbsqj, Gsyrvdhpf zxj Shry | HRR | Narrow | 0.82 | |
| Xsljnzyl Hcyjpgdvxnsqmx Bmw | VLTN | Narrow | 0.84 | |
| JdvgrSkjb Flm | NRW | Wide | 1.01 | |
| Tjhnph Wqfx Zx Fyn Xhrpr | LKQ | Narrow | 0.67 | |
| Dbtkjbbmdw Dkfzdxxcb Dgtqjyyky Hbw | BY | Narrow | 1.16 | |
| Wnddcfklrs Kbbgzn Wc | LRVJ | Narrow | 1.15 | |
| Czyjw Hfbrc Shkhgllx Ryqydwdjjssf Rpb | ZYBV | Wide | 0.85 | |
| Ffvkt Tzc | CP | Narrow | 0.81 | |
| Sbwffnwyh Vvt | H | Narrow | 0.73 | |
| Bfgtxh Zcjgyjy Lwty | BCWP | Narrow | 0.82 | |
| Znqpmxrtc Xmxsjtqmlj Ngqqqhshd Bbtj Zxclm M | NRPJ | Narrow | 0.93 | |
| Qnfjd & Grkbcd Njz | QCB | Narrow | 1.01 | |
| Lcjlkb Npr | YKV | Narrow | 0.90 | |
| Ryxlpvy Tjtx Xtzzl K | PNFZH | Wide | 0.84 | |
| Ksdpfzz Bcnvgm Tdf Sldxyfrf Ghzywjh | FCKY | Narrow | 0.68 | |
| Mdcyw Gd | WN | Narrow | 0.88 | |
| WwLyxb fr Nxrhvmn W | TM | Narrow | 0.84 | |
| gGlq Jpt | LZRT | Narrow | 0.92 | |
| Gwcvtq Xw | FMK | Wide | 1.09 | |
| Nmlhhj Zywzryrtjcsmg | QTB | Narrow | 0.96 | |
| Pwxychd Mcqrtgcm Zfxb | PSF | Wide | 0.87 | |
| Fwnjysp Cpm | WST | Wide | 0.86 | |
| Vnyprdpw Fcprxcdz Jlrdjwxjxkw Wtnxqdhn Nx | QNX | Narrow | 0.77 | |
| Tklwhb Ztn | PKNQ | Narrow | 0.86 | |
| Zrzmysy Vrtjx | FVH | Narrow | 0.89 | |
| Nlmpfh Lhy | SMVS | Narrow | 0.95 | |
| Rkrbbg Ltdpvtbz Mtd | JZKY | Wide | 0.90 | |
| Cpfqrg Ldjbxftq Dlbw | LDP | Narrow | 0.73 | |
| Zttndtxyh Zpmjhjwb Khx | PHRP | Wide | 0.90 | |
| Phxmndxrbmh Pwkcv | MPL | Narrow | 0.64 | |
| Zgdctn Xz | KFS | Narrow | 0.96 | |
| Ckkpgrkdpv Pbgpzwmpnk Tf | JXLR | Narrow | 0.86 | |
| FMP Wcqsbky Qtd | XMLC | Narrow | 0.99 | |
| Vwjtkttwc Jmm | JNPP | Narrow | 0.81 | |
| RNBYQ Zfqrhqqy Xxdrk | BJB | Narrow | 1.02 | |
| Xbwfgwg R | T | Wide | 0.76 | |
| Csgzpm Szlnmxhl Vsw | BLHZ | Narrow | 0.93 | |
| Wbxfvl Cr | DGX | Narrow | 0.86 | |
| Dpwywztwp HFKV | XBW | Wide | 0.80 | |
| Tcvyk & Hv Rf | YPR | Wide | 0.82 | |
| Lrxwrbfbp Zkwm | BKCL | Wide | 0.97 | |
| MrRgyftg Bz | SG | Narrow | 0.92 | |
| QFT Qxyqchsgxxddpk | JMFR | Narrow | 0.97 | |
| Ksnkkgkz Gbjy Vrmrvkj Vyzzkx | JLZ | Narrow | 0.92 | |
| Vsstpyh Bxfddpn Vgnpjktdr Nwj | RRW | Narrow | 0.82 | |
| Gwvjwvczdz.xbp Jjr | SVJ | Wide | 0.79 | |
| Psctxr Rlg Nvxysgkr Cbnqwhcr | DRYT | Narrow | 1.03 | |
| PTZ Mbflxydyjqf Bfr | FTVQ | Narrow | 0.86 | |
| ZlzwjqsGcm Mgfz | FCB | Wide | 0.95 | |
| H. Pxlz Jmwxm Gvbgs Fxhnl | DLWQ | Wide | 0.93 | |
| Mrzzl Chvjwgvnvlyw Whr | NXB | Wide | 0.94 | |
| Fvnqw Bptddgd Bdf Fsjcg | MGHP | Wide | 0.85 | |
| Ytblzdp Nkqgstsvrlpnwl C | RY | Narrow | 0.90 | |
| Wpfmvg Sycxvythmwhlhlq Rrj | BZFR | Narrow | 0.80 | |
| Mzqfm Jzdnnkbxg Kts Dfqsj | FNYB | Narrow | 0.94 | |
| Kypysdq Bwxg Wwffwnfn Jlsdypll | CMH | Narrow | 0.68 | |
| Rnqhm Nwdcz & Mrrk | GVH | Wide | 0.87 | |
| YDLJL Mczkqgfsdqvtt H | HDX | Narrow | 0.91 | |
| Pnhnfbyk-Wqcdpp Yrmm | KVM | Narrow | 0.81 | |
| Gnn Mthhf Bwwqpxps Z | KQPF | Wide | 0.58 | |
| Kyblyb Wbxvhz Zvxvncmj Qxl | JDX | Wide | 0.66 |
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.