When it comes to buy-and-hold investing, you can't go wrong with growth or value stocks. However, research from Bank of America/Merrill Lynch tells us that one category does offer a higher return over the long haul. According to a 2016 report that analyzed data over a 90-year period, beginning in 1926, value stocks offered an annualized return of 17%, compared to "just" 12.6% for growth stocks.

Considering that the stock market has had a few rough days recently, it would not be in the least bit surprising to see investors focusing their attention on value stocks. That's where the following three companies come into play. Consider this diverse group the top value stocks you'll want to own in February.

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ExxonMobil

Last week, integrated oil and gas giant ExxonMobil (NYSE:XOM) released its fourth-quarter and full-year results. Unfortunately, no one was gushing with excitement. Rather, it was ExxonMobil's stock that was hemorrhaging after per-share profits missed forecasts, sending its share price to levels not seen since 2011.

On one hand, there's truth in the fact that oil and gas giants like ExxonMobil aren't going to turn their businesses on a dime. They're somewhat prisoner to the price of commodities, and both crude oil and natural gas prices have been weak of late. However, it's important to realize that weakness in these commodities may be overdone due to coronavirus fears. The last couple of times health scares have affected the oil market, such as Ebola, the impact was short-lived, and I'd expect that to be the case here, too.

This is also a businesses that is historically hedged for long-term success. ExxonMobil's bread and butter remains its drilling operations (upstream), but its downstream refinery and chemical segments typically come into play when commodity prices slump (i.e., demand grows when access to fossil fuels becomes cheaper), thereby helping to partially offset drilling weakness. Recently, the company has seen margin weakness in both segments, which has contributed to its sinking share price.

But what's important to note here is that the reasoning behind these lower margins are temporarily, including higher scheduled maintenance costs for its refineries, and "weaker high sulfur fuel oil pricing [that] did not fully reflect in crude spreads," according to Neil Hansen, the VP of investor relations at ExxonMobil. These are short-term issues that I believe will lead to favorable year-on-year comparisons moving forward. 

At 17 times next year's earnings per share (EPS), ExxonMobil may not appear to be a value stock by traditional standards. However, ExxonMobil hasn't been this cheap on a price-to-book basis (1.38) in more than a decade, and hasn't been this inexpensive relative to sales since 2014. ExxonMobil is now a value stock, and its 5.6% dividend yield is just icing on the cake.

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Elevate Credit

On the opposite end of the spectrum, at least in terms of market cap, is Elevate Credit (NYSE:ELVT), a small-cap provider of lending and credit solutions in the U.S. and U.K. to people with below-average credit scores (i.e., subprime).

Elevate Credit went public back in 2017, at a time when other fintech offerings were getting clobbered, and was itself crushed in Oct. 2018, following an earnings warning. This particular warning was notable as now-former CEO of Elevate Credit, Ken Rees, noted that a number of factors caught management off-guard. The company wound up citing delayed technology rollouts and higher U.K. costs tied to complaints from claims management companies as reasons for lowering its full-year outlook at the time. But, as I believe the case to be with ExxonMobil, these are short-term concerns.

What Elevate Credit does well is plant itself perfectly between traditional financial institutions and money-lending services. According to Elevate, there are far more people with non-prime credit scores than prime, meaning there's a huge market of underbanked consumers. It offers a range of solutions, that vary from traditional credit cards, which bear 29.99% to 34.99% annual percentage rates (APR), to installment or line of credit loans that can range from 36% to 299% APR. This probably sounds like a lot, and it is much higher than traditional banks. But with no access to traditional lending solutions, Elevate offers subprime consumers an opportunity to utilize lending services for a lower APR than traditional brick-and-mortar money-lending services.

What's more, Elevate also reports positive credit activity to the lending bureaus if consumers pay their installments on time, which brick-and-mortar money-lending services don't do. This can help subprime consumers improve their credit scores, saving them money over the long run.

Despite a high charge-off rate (as would be expected with consumers that have less-than-stellar credit scores), Elevate's even higher APRs make it look like a bargain at just seven times next year's EPS. After growing its adjusted EBITDA from $19 million in 2015 to an estimated $137.5 million at the midpoint in 2019, this looks to be a value stock you'll want to own in February, and going forward. 

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Jazz Pharmaceuticals

Finally, value stock investors should consider orphan-drug developer Jazz Pharmaceuticals (NASDAQ:JAZZ) as a company worth buying in February.

For the past six years, Jazz Pharmaceuticals' stock has pretty much gone nowhere. Make no mistake, there have been periods of ebb and flow, but Jazz's share price is virtually unchanged from where it sat in Feb. 2014. This has to do with concerns that generic competition could wreck sales for its top-selling drug Xyrem, as well as the possibility that Congress could enact some form of drug-pricing reform. You see, Xyrem is one of a handful of therapies whose list price has skyrocketed over the past decade, and it's often a target of drug-price reform discussions.

That's the potential bad news. The good news, at least from an investment perspective, is that lawmakers are arguably more divided now than ever before on healthcare reform, which makes it highly unlikely that Jazz is going to lose its pricing power anytime soon.

Additionally, Jazz has seen robust success through organic and label expansion growth with Xyrem. Sales of sleep disorder drug Xyrem totaled $1.21 billion through the first nine months of 2019, up from $1.03 billion in the year earlier, and they're liable to head higher as price increases and new indications drive growth. Sales of Vyxeos and Defitelio are also up by a double-digit percentage through the first nine months of 2019. 

According to estimates from Wall Street, Jazz's EPS is expected to grow from $13.70 in 2018 to north of $21 by 2022. With Jazz Pharmaceuticals already valued at only 8 times next year's EPS, and sporting a PEG ratio of 0.8 (anything below 1 is considered a value), it looks to be one of the top bargains in the drug-development space.