Cheap is subjective, but no matter what you define to be a bargain or how high the market averages are soaring, there always seem to be stocks priced at points that seem too good to be true.

In screening for bargain stocks that could beat the market in 2020, I had to draw the line somewhere. I chose to limit my search to stocks trading for no more than 12 times forward earnings targets. There are plenty of other measuring sticks to use in filtering for Wall Street bargains, but this felt like a good place to start. 

AT&T (NYSE:T), eBay (NASDAQ:EBAY), and Carnival (NYSE:CCL) are three investments trading for 10 to 12 times what analysts see them earning in 2020. Let's go over why these three well-known companies could be bargains for value investing at current levels.

Carnival's P&O Pacific Jewel coasting along blue waters.

Carnival's P&O Pacific Jewel in Sydney's harbor. Image source: Carnival.

AT&T

You might think that stocks trading at low multiples would be out-of-favor investments, but that's not the case with Ma Bell. The wireless carrier had a big year in 2019, soaring a dividend-adjusted 46% last year. 

AT&T's bounce is a combination of the market appreciating the things that the telco giant is doing right (including its steadily growing wireless business and the upside of the Time Warner assets it acquired in 2018) instead of focusing on its fading DIRECTV satellite television and legacy wire-line segments. It also only helped that activists finally persuaded AT&T to begin shaking things up to raise shareholder value.

The only downside to the stock's resurgence is that the bountiful yield of more than 7% at the beginning of last year has been whittled down to 5.4% given the stock's pop. Investors can and should still appreciate AT&T with a yield north of 5%, trading at 11 times this year's earnings, and with exciting catalysts in 2020 including the rollout of 5G on the wireless front and the launch of the HBO Max premium streaming service.

eBay

There was a time when you couldn't even dream about eBay trading for just 12 times forward earnings. The online marketplace was a dot-com darling, but e-commerce has evolved to the point where eBay isn't as relevant as the growth star it was in its prime. 

There are way too many outlets to move new and secondhand merchandise these days, and eBay is feeling the pinch. It did clear $21.7 billion in gross merchandise volume in its latest quarter, but that's 2% less than it helped move a year earlier on a currency-neutral basis. 

In retrospect, eBay probably shouldn't have been so quick to unload so many of its assets. A decade ago, it was a handful of verbs. Then it went on to sell Skype and spin off PayPal, and it now has a $4 billion deal in place to cut StubHub loose. 

The market doesn't hate eBay. The shares still rose 31% in 2019. However, it was downgraded by Jefferies analyst Brent Thill earlier this week on concerns that consumers don't understand and much less care about eBay. Thill conducted a survey that showed just 20% of the respondents believe that eBay generates more revenue from new products than used ones, even though new merchandise now accounts for 80% of the sales on the platform.

It's fair to say that eBay is misunderstood by consumers, but now with the time to focus on its namesake verb, one can argue that it's also misunderstood and underestimated by Wall Street. 

Carnival 

We're in a buoyant economy, yet here we are with the world's leading cruise line operator trading at a 2020 earnings multiple that you can count on the fingers of both of your hands. Carnival has come through with double-digit growth in adjusted earnings per share in five of the past six years, but the stock finds itself essentially docked where it was at the beginning of last year.  

Weakness in Europe, a tricky hurricane season, and the cancellation of Cuba as a new port of call have weighed on the business. But Carnival remains a stock worth owning. As the middle class widens worldwide, Carnival's namesake cruise line continues to be the platform of choice for first-time cruisers. There will be ups and downs (just like the ocean waves), but it's hard to resist an industry leader with a yield that now tops 4%.