7 Highly Rated Stocks on Sale

I am always looking for a good deal, whether that means buying three boxes of Corn Pops when they go on sale or pouncing on undervalued stocks. The idea that anybody would sell a stock for less than its worth may seem silly, but legendary value investor Ben Graham tells us, by way of allegory, how we can look out for these situations.

In The Intelligent Investor, Graham introduces readers to a crazy dude named Mr. Market. Mr. Market's game is to pay you house calls on a daily basis to offer to sell you interests in businesses he owns or buy from you interests in businesses that you own. Sometimes Mr. Market will show up at your door very excited and offer you premium prices for your holdings, while at other times he'll be totally depressed about the future and will offer to sell you what he has for as low as pennies on the dollar.

So to find some of the stocks that Mr. Market is depressed about, I've turned once again to The Motley Fool's CAPS investor community. Each of the companies below had been given a five-star rating (the highest) by our community of investors just 30 days ago:

As the chart shows, these stocks are all still very well-regarded by the CAPS community despite their underperformance over the past month. While these aren't formal recommendations, they could be a great place to kick off some further research. I'll even kick you off with some thoughts on US Gold.

A gilded portfolio?
US Gold is, as you might expect, a company that focuses on gold. It has rights to a 36-square-mile area in Nevada where it is in the exploration stage. The company also currently has an outstanding tender offer for the shares of White Knight Resources, Nevada Pacific Gold, and Tone Resources Limited -- three companies that own mineral properties adjacent to US Gold's. Though the company has had trouble generating revenues, it is notable that Robert McEwen bought 33% of the company in 2005 and has become the chairman and CEO. McEwen was the founder of Goldcorp (NYSE:GG), which is now a $17 billion business.

CAPS players' focus has been primarily on McEwen, though there are some mentions of gold prices. LookingBeyond99, who was singled out as having the best bull pitch, says, "Rob McEwen creates shareholder wealth and understands the gold industry. He was able to build Goldcorp into a mid tier gold company that more importantly really built wealth for its shareholders. Because of his track record and knowledge of the industry I think he will lead US Gold to successful new highs."

Gold itself is an interesting topic, because it stirs up some pretty contentious views. Plenty of people dismiss the idea of gold having any place in an investor's holdings, while many fanatics -- some of whom have very lucid arguments -- think gold should play a significant role in a portfolio. Gold as an investment has picked up some amount of stigma, though, because it is particularly popular among the apocalypse-scenario crowd - people who keep massive stores of non-perishable food and rifle ammo in their bomb shelters for the day our economic system crashes.

In terms of US Gold, investors can definitely do worse than betting alongside a manager with a proven track record -- particularly when he has taken such a large ownership position in the company. Though McEwen is no longer involved with Goldcorp, in the five years prior to his departure for US Gold, Goldcorp stock appreciated 370%. Now investors will see whether McEwen can do it all over again.

For more CAPS coverage:

• 7 Growth Stocks on Sale
• Get yer upgrades and downgrades here.
• 5 More Top Growth Stocks

Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned, nor does he own any gold bullion. You can check Matt's CAPS portfolio here, or tune in to his CAPS blog here. Safety Insurance Group is a Motley Fool Stock Advisor pick. Exelixis is a Rule Breakers choice. The Fool's disclosure policy isn't made of gold, but it sure does have a heart of gold.