America's Next Top Value Stock

Though value investors have been some of the most successful investors out there, finding good stocks at bargain prices is far from easy. Though markets aren't as efficient as some university professors may want to tell you, they generally do a pretty good job pricing stocks. So while there are good deals out there, you're going to have to break a bit of a mental sweat if you want to make sure that you're investing in the stock equivalent of Brad Pitt, not Kato Kaelin.

Fortunately for us, in the search for stock market values, we have the 150,000 members of The Motley Fool's CAPS community voting on which stocks are true stars and which are just posers. To gather some ideas I've dug up a handful of companies valued at less than twice their book value -- a measure often used by value investors.

Source: Yahoo! Finance, and CAPS as of Feb. 23.

As you can see, though these stocks all carry value-like multiples, the CAPS community obviously doesn't think that all are worthy of your investment dollars.

No twinkle in these stars
That is not a typo on Beazer -- its stock has been an absolute screamer over the past year. It easily trounced the returns from competitors like KB Home and Lennar. Of course, part of the reason it's done so well over the past twelve months is because it had done so poorly in the years prior. In fact, even with that near 700% run, Beazer's stock is still trailing most of the other major homebuilders over a five-year period.

So does that mean that it still has room to run? Perhaps. But I would hardly call myself a housing bull, and more than half of Beazer's total assets are in inventory. I also have a tough time finding any sort of competitive advantage that Beazer has against any of the other homebuilders. And with a bottom-of-the-barrel one-star rating from the CAPS community, it's apparent that I'm not the only one who feels this way.

In the world of mobile handsets, it's hard to compare anyone to Apple (Nasdaq: AAPL) and its iPhone. For Motorola, though, shareholders may be less concerned about topping Apple and more concerned about simply seeing the company get its footing back.

In each of the past three quarters, Motorola has reported a profit, which is a step in the right direction after an abysmal stretch of on-again-off-again (but mostly off-again) profitability dating back to early 2007. It's also getting ready to split the company in two, a move that could help the two halves improve focus. And, finally, the company may be hoping to ride Google's (Nasdaq: GOOG) coattails as Big G shoves its way into the cell phone market.

But Motorola's future is still tied up in a lot of "ifs" and "maybes," so I don't foresee too many investors giving Jersey Shore fist pumps over this stock.

FedEx's three-star rating doesn't mean that it'd be completely silly to consider an investment -- in fact, there may be reason to believe that the shipping giant could surprise Wall Street. What the three-star rating does mean, though, is that CAPS members think that there are better opportunities to be had.

A five-star is born!
I recently wrote about the fact that E*TRADE got its head handed to it thanks to a loss of focus and too much noodling around in areas where it simply didn't have expertise. What was so troublesome about E*TRADE's belly flop was that the company was actually very good at its core business.

Now it may seem tempting to assume that E*TRADE's stock -- which is still down around 95% from its early 2006 prices -- is ready to skyrocket. But we're still waiting on the company to return to profitability, and the E*TRADE of today is tough to compare to early 2006 thanks to massive share dilution that it undertook in order to help deal with a deteriorating balance sheet. With four stars from the CAPS community, though, it's apparent that many people see a comeback in the cards.

E*TRADE's four-star rating, however, leaves it one star short of this week's top value stock, Valero.

Not only is Valero the top-rated stock in this week's group, but it also carries the lowest valuation. This doesn't come out of the blue, though. Valero's results have been fairly disappointing for some time now and it doesn't seem like there will be a quick fix.

Of course, looking at the current valuation -- which is somewhere between a half and a fourth of the book value multiple that Valero has fetched in the past -- it's not hard to see why this stock could be the subject of some bottom fishing.

Make your vote count!
Do you agree that Valero could be America's next top value stock? Click over to CAPS and let the rest of the community know what you think. And while you're there, you can log your vote for the other stocks that you think should be in the running.

These low-priced stocks may be able to deliver, but my fellow Fool Anand Chokkavelu thinks he knows your best shot at a 10-bagger.