I am always looking for a good deal, whether that means buying an extra box of Golden Grahams 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 (no relation to the cereal) tells us, by way of allegory, how we can look out for these situations.

In The Intelligent Investor, Graham introduces readers to a wacky chap 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 inconsolably depressed about the future and will offer to sell you what he has for as low as pennies on the dollar.

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

1-Year Return

Current CAPS Rating
(out of 5)

General Steel Holdings (NYSE:GSI)




KHD Humboldt Wedag








Berkshire Hathaway (NYSE:BRK-A)




Joy Global (NASDAQ:JOYG)












Data from Motley Fool CAPS as of Sept. 8.

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 Motley Fool Stock Advisor favorite Berkshire Hathaway.

Why so blue?
After enduring slings and arrows during the stock market's plunge -- which whacked Berkshire holdings like Wells Fargo (NYSE:WFC) and American Express and made its derivatives contracts look like an earnings-statement Ebola virus -- Berkshire Hathaway seems to have gotten some of its footing back. Sure, operating earnings at the company have suffered, but savvy investments in companies such as Goldman Sachs (NYSE:GS) have helped put some of the swagger back in the Buffett name.

But in spite of this turnaround at the company, the stock appears to still have a sellers' target painted on it. We could chalk it up to any number of reasons. The economy may not jump back to life even if growth does return, and that could mean that the economic iron boot stays firmly planted on the neck of Berkshire's operating companies.

Or we could be seeing investors steeling their portfolios for the upcoming stock market correction. A correction would not only hurt Berkshire's stock portfolio, but would also flog those derivatives contracts again.

What the bulls say
But all of this seems just a bit shortsighted to me. Berkshire's portfolio is full of high-quality stocks like Coca-Cola (NYSE:KO) and Procter & Gamble (NYSE:PG) that may not deliver eye-popping results, but also don't pose huge risks. And the derivatives that Buffett wrote on market levels are so long-dated that there seems little chance that Berkshire won't be on the plus side by the time the contracts settle.

And of course there are Berkshire's operating businesses. The group includes a lot of stable, dependable businesses, like Business Wire, GEICO, Fruit of the Loom, and Dairy Queen. Certainly some of the others -- such as Clayton Homes and RC Willey -- have more chance of struggling as the housing market and consumers continue to suck wind. But neither housing nor the consumer will stay in a coma forever, and in the meantime these companies have the backing of Berkshire's balance sheet.

And maybe most important is what CAPS member Dobbes pointed out when giving Berkshire a thumbs-up back in July:

Buffett has made a number of acquisitions in this recent downturn. That's what value investors do, buy at a discount and hold. Traditionally they do best in the first phase of an economic cycle (now), which is what signals my entry, but I have confidence Berkshire can beat the S&P routinely.

But here's the important question: Do you think the recent drop has created a good buying opportunity? Or will the recession continue to put a hurting on Berkshire? Head over to CAPS and share your thoughts with the 140,000 members currently part of the community. Even if you'd prefer to pass on Berkshire, you can check out a couple of the other stocks listed above or any of the 5,300 stocks that are rated on CAPS.

More CAPS Foolishness: