The United States is in the midst of a historic economic expansion, which has now reached 116 months. While it's bound to end eventually, there's plenty of optimism to go around at the moment.

The most recent jobs report shows the country added 196,000 jobs in March to hold the unemployment rate at a relatively low 3.8%. The Federal Reserve has signaled it likely won't raise interest rates in 2019, while some analysts even think interest rates could be reduced in the near future, for reasons economic or political.

It all suggests that the current economic boom will persist for a while longer, which would bode well for materials producer Allegheny Technologies (NYSE:ATI) and renewable-energy leader SolarEdge Technologies (NASDAQ:SEDG). Both businesses entered the year with considerable operating strength, but with shares trading at relatively low valuations. With first-quarter 2019 earnings just weeks away, investors might want to give these two stocks a closer look in April.

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Is Wall Street overlooking this successful turnaround?

Allegheny Technologies develops and manufactures engineered materials and metal alloys for a wide range of applications. After making several difficult decisions in recent years to write off underperforming assets and exit low-margin applications, the business finds itself on firmer footing today and better positioned to exploit opportunities in core markets.

While half of total revenue is sourced from aerospace applications, Allegheny Technologies reported higher year-over-year sales in 2018 for all eight markets it serves across its two business segments. The high-performance materials and components (HPMC) segment delivered operating income of $335 million, up 36% from 2017. Meanwhile, the flat-rolled products (FRP) segment more than doubled operating income to $78 million in that span thanks to a focus on higher-margin products and new joint ventures. Both amounts were the highest since 2011. 

That strength boosted the company's operating margin to 10.2% last year, up from just 0.2% in 2016. Allegheny Technologies also reported its first positive net income since 2013, representing earnings per share of $1.78, and its highest net income since the commodity boom of 2008. The $3.4 billion business exited 2018 with $382 million in cash and cash equivalents to invest in continued high-margin growth opportunities. 

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Management expects the operating strength to continue in 2019. The HPMC segment is expected to see revenue and operating income increase this year, including an improvement of 150 basis points (an absolute gain of 1.5%) in segment operating margin. The smaller FRP segment is expected to match last year's performance due largely to the timing of raw materials increases and planned selling-price increases. 

Given all of that, investors might expect that Allegheny Technologies has been handsomely rewarded by Wall Street for its quick and successful turnaround. But that's not the case. While the stock has outpaced the S&P 500 in the last three years, it's still relatively undervalued. Shares trade at just 17 times trailing earnings and 10.5 times future earnings. By comparison, the S&P 500 is trading at a cyclically adjusted P/E of 31. Shares of the engineered materials leader also sport a PEG ratio of just 0.18 and trade at less than 1 times sales.  

If the business can continue to capitalize on the profitable growth opportunities ahead of it in aerospace, energy pipelines, and various other markets in 2019, then shares will probably be valued more appropriately by investors. That might begin with first-quarter 2019 earnings in the coming weeks.

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An undervalued leader in solar energy products

SolarEdge Technologies is well positioned to capitalize on a seemingly insatiable global appetite for solar energy. The company's main products are power optimizers that allow solar modules to efficiently and cheaply harvest energy. The modules are in increasingly high demand for the value added to solar power installations. And recent acquisitions show the business also has ambitions in electric vehicle (EV) charging, EV powertrains, software solutions, and energy storage markets.

The expansion into a diverse range of clean energy products and services figures to be de-risked by the company's profitable growth trajectory. Annual revenue has jumped from $133 million in 2014 to $937 million in 2018, while gross profit has improved from $22 million to $319 million in that span. Last year, SolarEdge reported a number of record operating results, including operating income of $139 million and operating cash flow of $189 million. 

The business expects another record performance in 2019, which should be the first year that annual revenue exceeds $1 billion, although recent acquisitions are expected to reduce margins and earnings per share. Given management's track record, shareholders might be willing to extend the benefit of the doubt that the company can increase the operating efficiency of its acquisitions over time. That's a little easier to do considering the stock is trading at an attractive valuation, especially for investors with a long-term outlook.

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Shares of SolarEdge Technologies are trading at just 15 times trailing earnings and 12 times future earnings. The company's market cap of $1.9 billion represents just 2 times sales, which also appears relatively cheap considering the balance sheet held $383 million in cash, cash equivalents, and marketable securities at the end of 2018. 

Given the above-average opportunities for both near- and long-term growth, the company's financial strength and flexibility can't be overlooked by investors. In the near term, SolarEdge Technologies is well positioned to exploit America's deepening reliance on solar energy; electrical output from solar power increased 24% year over year in 2018 and now accounts for roughly 2.5% of the country's total electricity production. In the long term, ramped-up sales from nonsolar products -- especially in EV applications -- promise to keep driving growth.

It all points to confidence that the business can deliver on (or even beat) its first-quarter 2019 guidance calling for roughly $265 million in revenue and 31% gross margin.