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 it's 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, whose 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

One-Year Return

Current CAPS Rating
(out of 5)

Chesapeake Energy (NYSE: CHK)




Exelixis (Nasdaq: EXEL)




Jinpan International (Nasdaq: JST)




Data from Motley Fool CAPS as of March 23.

As the table shows, these stocks are still very well-regarded by the CAPS community despite their underperformance over the past month. While these are not formal recommendations, let's take a closer look at whether opportunity could be staring us in the face.

Chesapeake Energy
For Chesapeake, the problem boils down to its main product: natural gas. Coming into the year, natural gas prices were nowhere near the 2008 peak, and they've spent most of the year falling.

The stock prices of competitors like Southwestern Energy (NYSE: SWN) and Devon Energy (NYSE: DVN) also seem to be reflecting the weak natural gas market. In fact, it got so bad for SandRidge Energy (NYSE: SD) that the company spent the past year transitioning its focus from natural gas to oil.

But while natural gas may be down, I hardly think it's out. There are plenty of good reasons to think that it could play an increasingly large role in energy production, not the least of which is the relative cleanliness of the fuel.

Most of the CAPS members who weighed in on Chesapeake's prospects seem to think that this will eventually propel its stock higher, and I tend to agree. Assuming management's greed doesn't get the upper hand.

What does a drug development company with no approved drugs do? It racks up losses.

So the loss that Exelixis posted earlier this month shouldn't have surprised investors too much, particularly because it was in line with what analysts had expected. However, the announcement that the company is going to cut 40% of its workforce may have done more to spook investors.

But none of this was enough to shake the CAPS members voting on the stock. One person wrote that cutting back the company's solo-development efforts and focusing on its work with development partners sanofi-aventis and Bristol-Myers Squibb (NYSE: BMY) seems like a smart move. Other Exelixis bulls note that the opportunity remains the same as ever: If one of the company's cancer drugs actually connects, the stock will go through the roof.

Jinpan International
Why has Jinpan continued to fall after blowing out earnings estimates for its fourth quarter? You got me. Like I said above, sometimes Mr. Market does wacky things.

What Jinpan's fall has undoubtedly done, though, is make the stock cheaper. Analysts believe the company will notch $1.83 in earnings per share in 2010, giving the stock a forward price-to-earnings ratio of just 11.8.

Meanwhile, CAPS members have been staunchly positive on the stock, giving it a perfect five-star rating. One of the Jinpan fans on CAPS, ChemDude11, weighed in with this bullish take at the end of last year:

In a rapidly expanding and recovering economy for the world's emergent economic superpower, what's NOT to like about this company. Low P/E, strong earnings, dividend paying, etc......They will be a major engine in the industrial growth of China. Simple....Done deal.

I've already given two of these stocks a thumbs-up in my CAPS portfolio. But here's the important question: What do you think? Head over to CAPS and share your thoughts with the other 160,000 members.

Think these stocks are good? Well Fool Jordan DiPietro thinks he's found the best investment that Wall Street won't touch.