5 New 5-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 March 6, 32 stocks saw their ratings change to 4 stars, while five joined the 50 US-listed names in 5-star territory.

The five new 5-star stocks, ordered by market capitalization, are:

• Nike NKE
• NetEase NTES
• Constellation Brands STZ
• VF VFC
• Blue Owl Capital OWL

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 Market Index fell 2.14% over the past week as of March 6, leaving the overall US stock market moderately undervalued, hovering at an 8.00% discount to its fair value estimate on a market cap-weighted basis.

Of the 827 US-listed stocks covered by Morningstar analysts:

• 37% are undervalued, 42% are fairly valued, and 22% are overvalued.
• 32 are newly undervalued.
• Eight are newly overvalued.
• Five moved from a 4-star rating to a 5-star rating.
• 14 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 5-Star Stocks

Nike

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $102.00
• Uncertainty Rating: High

Accessory firm Nike lost 7.70% over the past week. Nike has dropped 12.86% over the past three months and 24.80% over the past year. The stock is trading at a 44% discount to its fair value estimate of $102 per share, with an Uncertainty Rating of High. Nike is a large-value company with a wide economic moat.

NetEase

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $200.00
• Uncertainty Rating: High

Following a 2.46% gain over the past week, electronic gaming company NetEase saw its Morningstar Rating move to 5 stars from 4. NetEase has lost 15.72% over the past three months and has gained 17.10% over the past year. The large-core stock has a narrow economic moat. NetEase is trading at a 41% discount to its fair value estimate of $200 per share, with an Uncertainty Rating of High.

Constellation Brands

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $220.00
• Uncertainty Rating: Medium

Alcoholic beverages company Constellation lost 7.22% over the past week. The stock has climbed 3.56% over the past three months and dropped 16.01% over the past year. The stock is trading at a 33% discount to its fair value estimate of $220 per share, with an Uncertainty Rating of Medium. Constellation is a mid-value company with a wide economic moat.

VF

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $39.50
• Uncertainty Rating: Very High

Apparel manufacturing company VF dropped 10.81% over the past week. The stock is down 8.65% over the past three months and 13.82% over the past year. The stock’s price is 56% below its fair value estimate of $39.50 per share, with an Uncertainty Rating of Very High. The small-core stock has no economic moat.

Blue Owl Capital

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $18.00
• Uncertainty Rating: High

Following a 6.26% loss over the past week, asset management firm Blue Owl saw its Morningstar Rating move to 5 stars from 4. Blue Owl has lost 37.83% over the past three months and 45.86% over the past year. The small-core stock has a narrow economic moat. Blue Owl is trading at a 45% discount to its fair value estimate of $18 per share, with an Uncertainty Rating of High.