I am always looking for a good deal, whether that means buying an extra box of Lucky Charms when they're 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 wacky guy 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 to buy from you interests in businesses 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:


30-Day Return

One-Year Return

Current CAPS Rating (out of 5)





Silver Standard Resources




The9 Limited (NASDAQ:NCTY)




Petroleo Brasileiro (NYSE:PBR)




NetEase.com (NASDAQ:NTES)




Yamana Gold (NYSE:AUY)








Data from Motley Fool CAPS as of Aug. 21.

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

No time for fun and games?
That's what Mr. Market seems to be saying lately, as he has socked both NetEase and The9 right in the mouth with 20%-plus losses over the past month. Way to be a big, fat wet blanket, Mr. Market.

NetEase, a 2005 pick of the Fool's Rule Breakers newsletter, actually started its life as one among a multitude of providers of wireless value-added services (WVAS) in China. Government regulations and increased competition in that sector, though, have absolutely clobbered companies in that business. While some companies, such as KongZhong, have doggedly stuck it out through the tough times, NetEase opted to branch out in new directions.

NetEase started offering MMORPG (or massively multiplayer online role-playing games, for the uninitiated) back in 2001 with the launch of a game called Westward Journey Online. Though it was originally a small piece of NetEase's business, it now dwarfs what remains of its WVAS services by a multiple of almost 25. The MMORPG business has not only helped NetEase deal with rapidly declining WVAS revenue, but has been a powerful growth engine for the company.

The9, along with another Rule Breakers pick, Shanda Interactive Entertainment (NASDAQ:SNDA), competes with NetEase in the world of MMORPGs. Though the company isn't as diversified as NetEase, which has its WVAS business and a Web portal in addition to MMORPG offerings, it did score a huge hit in the MMORPG world with the release of Blizzard Entertainment's World of Warcraft (WoW). The popularity of WoW has been so great that in 2006, China's Ministry of Culture named it the most popular online game in that country.

More recently, the company scored a license from Electronic Arts (NASDAQ:ERTS) to operate EA's FIFA Online game in China. Even more significant, though, was the fact that EA bought a 15% stake in The9, suggesting that there's more to come between these two companies.

Recent declines in the stocks can be attributed to a combination of the general market woes -- which have been a bit harsher on many Chinese American depositary receipts -- and some flat results from NetEase in the second quarter. As fellow Fool Rick Munarriz points out, though, the slowdown was largely anticipated, and the company is expecting to benefit from a strong pipeline of new games. Investors should get some more industry color later this month when The9 reports its second-quarter earnings.

CAPS players have stuck behind these gaming companies and expect big things in the future. Back in July, TheGarcipian, a CAPS All-Star, highlighted the company's no-nonsense financials, including the lack of any debt and a solid return on equity. TheGarcipian also points out the huge market for The9's offerings:

... [T]here are potentially 4x-6x more Chinese adolescents and twenty-somethings that adore these games than in the USA. And they will be playing them online with their friends over networks run by the likes of The9 Limited.

So does the industry-wide drop create a good buying opportunity? Or is the slow growth from NetEase a sign of things to come? Let the community know what you think -- head on over to CAPS and share your thoughts with the other 60,000-plus players currently part of the community. Even if you'd prefer to pass on the MMORPG crew, you can check out a couple of the other stocks listed above -- or any of the 4,900 stocks that are rated on CAPS.

More CAPS Foolishness:

Electronic Arts and Netgear are Stock Advisor recommendations. Petroleo Brasileiro is an Income Investor pick.

Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. You can check out Matt's CAPS portfolio here, or tune into his CAPS blog here. The Fool's disclosure policy loves fun and games much more than Mr. Market, but doesn't play around when it comes to finding good stock bargains.