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.

Eugene Fama and Kenneth French have done some truly compelling academic research on stocks. They propose that there's more to stock returns than volatility -- which had been the prevailing wisdom from most academics. In research they conducted in different times and places, Fama and French conclude that stocks characterized as "value stocks" have consistently outperformed non-value stocks.

Today, I've rounded up five value stocks that are 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 Motley Fool CAPS community of more than 95,000 investors.

Company

Tangible Book Value Multiple

1-Year Change

CAPS Rating

Ares Capital (Nasdaq: ARCC)

0.8

(28%)

****

SeaBright Insurance (Nasdaq: SEAB)

1.2

(20%)

****

Westar Energy (NYSE: WR)

1.2

(15%)

*****

AU Optronics (NYSE: AUO)

1.5

20%

*****

Golden Star Resources (AMEX: GSS)

1.5

(21%)

****

Data from CAPS, Yahoo! Finance, and Capital IQ as of April 4.

Although the CAPS community obviously likes these stocks, I advise against investing in any of them on the basis of this one metric alone. With that in mind, I thought I'd dig in a little further to the story at SeaBright Insurance.

Ahoy, SeaBright!
Talk about off-the-radar -- if it weren't for press releases, SeaBright's news feed on Yahoo! Finance would be practically empty. This may not be terribly surprising not only because it's only a $300 million company, but its business -- complicated workers' compensation insurance -- isn't exactly the stuff that ignites hot headlines.

On CAPS, the stock has caught the attention of only 120 investors, despite its solid four-star rating. One of those players that has given SeaBright the nod is Deraj83, who offered this breakdown of the company last summer:

[SeaBright] is a well-run company with a history of beating earnings estimates. Looking at first quarter financial statements, it appears that the company's total U.S. mortgage exposure is limited, so I find it difficult to justify the extent of the recent sell-off. I think it has created a buying opportunity. Solid growth is expected to continue, and the company's fundamentals are pretty good, including having little debt on the books.

Since deraj's pitch, the company has continued to keep up with those earnings estimates. It "just" matched estimates in its third quarter, but it came back and beat Wall Street numbers by $0.01 in the fourth quarter, as announced in February. And even though conditions in the insurance industry have softened, SeaBright ended the year with double-digit percentage gains in both revenue and net income. Weakening conditions showed in the company's rising combined ratio, but it was still able to keep it at a very profitable 83.8% in the fourth quarter.

It's also worth noting that, as was the case when deraj made his pitch, the company limited its exposure to mortgage-backed securities, and no exposure to the subprime junk that has been causing other insurers like AIG (NYSE: AIG) so much trouble.

Looking forward, there are certainly question marks for the company. SeaBright is still a small niche company with most of its business in California, and it may run into increased competition as it continues to grow. And although the company was able to deliver solid growth in 2007, continued industry softening could hurt 2008 results. However, this does appear to be a well-run company with a solid business, and the trailing earnings multiple of just 7.7 qualifies it as pretty darn cheap.

So what do you think? Are these stocks values, or value traps? Log onto CAPS and let the rest of the 95,000 member community know what you think.

More CAPS Foolishness:

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