Are you familiar with the dynamic duo of Fama and French? No, they didn't sing "Private Eyes" -- that was Hall and Oates. And no, they didn't star in Tommy Boy -- that was Farley and Spade.

While the names Eugene Fama and Kenneth French may not come up in most dinner conversations, the two have done some of the most interesting academic research on stocks that I've read. In short, they've proposed that there's more to stock returns than volatility -- which was most academics' previous consensus. In research they conducted over various periods and across multiple geographic locations, Fama and French determined that stocks characterized as "value stocks" have consistently outperformed non-value stocks.

Today, I've rounded up five value stocks that are all trading at less than 1.5 times their tangible book value. To focus on high-quality stocks, I've cross-referenced these against ratings in our CAPS community of more than 94,000 investors.

Company

Tangible Book Value Multiple

1-Year Change

CAPS Rating (Out of 5) 

Xinyuan Real Estate Company (NYSE: XIN)

1.2

NA

****

Vishay Intertechnology (NYSE: VSH)

1.1

(36%)

****

Harris & Harris Group (Nasdaq: TINY)

1.2

(46%)

****

Cincinnati Financial (Nasdaq: CINF)

1.1

(7%)

*****

Jamba (Nasdaq: JMBA)

1.4

(71%)

****

Data from CAPS, Yahoo! Finance, and Capital IQ (a division of Standard & Poor's) as of March 28.

Though the CAPS community obviously likes these stocks, I would advise against investing in any of these on the basis of this one metric alone. With that I mind, I thought I'd dig in a little further to the story at Xinyuan Real Estate.

More palatable real estate
In the U.S., the words "real estate" can be counted on to bring a rapid halt to pretty much any conversation these days. Real estate isn't the surefire get-rich-quick scheme that it was earlier in the decade, and many homeowners and "investors" are finding themselves on the bad end of foreclosures. Meanwhile, stocks of U.S. homebuilders like Lennar (NYSE: LEN) and KB Home (NYSE: KBH) have taken a dive as demand for housing has dried up.

But the picture is very different in everybody's favorite growth market -- China. At least one could infer that from the recent earnings report from Xinyuan Real Estate. In 2007, the company boosted revenue 118%, and net income increased 164%.

It's worth noting that this growth comes from a very small base. While U.S. homebuilders like KB Home are generating hundreds of millions in revenue per quarter, Xinyuan's total 2007 revenue was $310 million. But the company's focus on building housing for China's middle class in second-tier cities seems like a good strategy as that middle class continues to grow and become wealthier.

Though the stock is not heavily followed on CAPS, it has 81 outperform ratings against just eight underperforms. Most of the CAPS players bullish on Xinyuan seem to share the sentiments of shravankrish, who simply commented "China!!!!" with his outperform rating. In other words, the consensus seems to be that Xinyuan can't help but be lifted by the rising tide in China.

Even with the strong 2007 growth, the stock hasn't paid off yet. After its IPO at $14 in December, the stock has fallen to about half that. For those who like the growth story in China, and specifically China real estate, the current valuation could be tempting. The stock's current $7.75 price tag is roughly 20 times 2007 earnings per share (prior to an adjustment to the company's convertible debt). If Xinyuan can continue to grow at even a fraction of its rate in 2007, this price could turn out to be a pretty good deal.

So what do you think? Are these stocks values, or value traps? Log onto CAPS and let the rest of the 94,000 members in the community know what you think.

More CAPS Foolishness:

Cincinnati Financial is an Income Investor pick, and Harris & Harris is a Rule Breakers selection. You can test out either Fool newsletter service free for 30 days.

Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. The Fool's disclosure policy wouldn't know a value trap from a hole in the wall, but then again, the disclosure policy is just an inanimate collection of words.