11 New 4-Star Stocks This Week

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Once a week, we screen the US-listed stocks under Morningstar’s coverage for newly undervalued names—those whose prices have just fallen into ranges worthy of 4- or 5-star

. For the week ended Aug. 28, 11 stocks saw their ratings change to 4 stars, while none joined the 46 US-listed names in 5-star territory

The new 4-star stocks with the largest market capitalization are:

• Marvell Technology MRVL
• Northrop Grumman NOC
• Hewlett Packard Enterprise HPE
• Xylem XYL
• Qnity Electronics Q

The full list of new 4-star stocks is at the bottom of this story. All returns in this article are reported in the stock’s base currency, and all data is sourced from Morningstar Direct.

What Is the Morningstar Rating for Stocks?

The Morningstar Rating can help investors identify stocks that are truly undervalued or overvalued, cutting through the market noise. The rating is determined by three factors: a stock’s price, its

—Morningstar’s estimate of its intrinsic worth—and its , which captures the range of potential outcomes for that estimate. Stocks rated 4 or 5 stars are considered undervalued, those rated 3 stars are fairly valued, and the ones rated 1 or 2 stars are considered overvalued.

The Latest Stock Valuation Changes

The Morningstar US Total Market Index rose 0.28% over the past week as of Aug. 28, leaving the overall US stock market moderately undervalued, hovering at a 7.00% discount to its fair value estimate on a market cap-weighted basis.

Of the 880 US-listed stocks covered by Morningstar analysts:

• 34% are undervalued, 44% are fairly valued, and 22% are overvalued.
• 11 are newly undervalued.
• Nine are newly overvalued.
• None moved from a 4-star rating to a 5-star rating.
• Five moved from a 5-star rating to a 4-star rating.
• None of the newly undervalued stocks jumped from a 3-star rating to a 5-star rating.
• 16 are no longer undervalued.

Metrics for This Week’s New 4-Star Stocks

Marvell Technology MRVL

• Morningstar Rating: ★★★★
• Fair Value Estimate: $300.00
• Uncertainty Rating: High

Semiconductor company Marvell dropped 8.61% over the past week. The company’s stock is up 5.78% over the past three months and 181.09% over the past year. The stock’s fair value estimate rose to $300 per share from $270 during the week. It ended the week trading at a 28% discount to its new fair value estimate, with an Uncertainty Rating of High. The large-growth stock has a narrow economic moat.

Northrop Grumman NOC

• Morningstar Rating: ★★★★
• Fair Value Estimate: $630.00
• Uncertainty Rating: Medium

Following a 0.99% loss over the past week, aerospace and defense company Northrop Grumman saw its Morningstar Rating move to 4 stars from 3. Northrop Grumman has lost 2.01% over the past three months and 5.71% over the past year. The mid-core stock has a wide economic moat. Northrop Grumman is trading at a 13% discount to its fair value estimate of $630 per share, with an Uncertainty Rating of Medium.

Hewlett Packard Enterprise HPE

• Morningstar Rating: ★★★★
• Fair Value Estimate: $64.00
• Uncertainty Rating: High

Communication equipment firm Hewlett Packard lost 2.13% over the past week, shifting its Morningstar Rating to 4 stars from 3. Hewlett Packard has climbed 37.30% over the past three months and 130.39% over the past year. The stock is trading at an 18% discount to its fair value estimate of $64 per share, with an Uncertainty Rating of High. Hewlett Packard is a mid-core company with no economic moat.

Xylem XYL

• Morningstar Rating: ★★★★
• Fair Value Estimate: $129.00
• Uncertainty Rating: Medium

Specialty industrial machinery firm Xylem dropped 1.49% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is up 2.27% over the past three months and is down 21.62% over the past year. The stock’s price is 14% below its fair value estimate of $129 per share, with an Uncertainty Rating of Medium. The mid-core stock has a narrow economic moat.

Qnity Electronics Q

• Morningstar Rating: ★★★★
• Fair Value Estimate: $150.00
• Uncertainty Rating: High

Following a 6.69% loss over the past week, semiconductor equipment and materials firm Qnity saw its Morningstar Rating move to 4 stars from 3. Qnity has lost 24.31% over the past three months. The mid-growth stock has a narrow economic moat. Qnity is trading at a 20% discount to its fair value estimate of $150 per share, with an Uncertainty Rating of High.