5 More Frugal 5-Star Stocks

'Tis the season once again for mistletoe, jolly old fat men (St. Nick, not the Cowboys' offensive line), and of course, last-minute bargain shopping. But as we all know, the problem with hunting for sales is that you can never be sure whether your gifts will earn holiday cheers or jeers. That's pretty much how it goes when trying to find bargain-basement stocks, too.

Our penny-pinching process
In that spirit, and with the help of our community over at Motley Fool CAPS, I'll try to dig up some cheap stocks just in time for the holidays. The approach is far from complicated, and it even borders on the elementary: I'll run a simple screen for five-star stocks (the highest rating a stock can get in CAPS) that have enterprise value-to-EBITDA (EV/EBITDA) multiples below 10. I'll be using EV/EBITDA rather than the more common price-to-earnings ratio, so that we can account for differences in each company's capital structure.

In other words, you won't be finding high-profile, high-multiple growth stories like Starbucks (NASDAQ:SBUX), eBay (NASDAQ:EBAY), or Amazon.com (NASDAQ:AMZN) as part of the Frugal Five anytime soon.

Meet the Frugals
Instead, by running this screen, we'll zero in on statisticallycheap stocks that, according to our CAPS community, have plenty of great reasons to trade at much higher levels. So without further ado, here is this week's list of Frugal Five-Stars:

Today's list is comprised of a research software company, a firm that offers marine support, a chlorine producer, and two seismic data providers. Surely, this group isn't as much of a snoozer as some of the railroad- and cargo-filled lists we've had before, but these companies aren't exactly the life of the office Christmas party, either.

That's OK. Here's a quick summary of these stocks, and what some of our CAPS players are saying about them. Some of these bullish arguments might just have you jingle-bell-rocking all the way to the bank.

Stat stocking stuffer
Last month, SPSS, a provider of predictive analytics software, reported impressive third-quarter results as operating income rose 17% while revenues grew 11%. The Illinois-based company, whose statistical software I personally used in my college days, seeks to help a wide range of clients increase profitability and efficiency. According to one CAPS player, PearlandTX, SPSS is definitely doing a good job in his own line of work:

"After using their software on various marketing projects, I am very impressed with their product. SPSS is powerful and easy to use. Marketing profession is under increasing pressure to make decisions based on deep analysis."

Comet and Cupid and Dawson and Blitzen
Motley Fool Hidden Gems selection Dawson Geophysical was recently nominated by fellow Fool Ryan Fuhrmann as 2007's best small cap. He made a convincing case, arguing that the seismic data specialist from Texas is in perfect position to capitalize on high energy prices and increased exploration. Newbie CAPS resident stockyjester, however, sees opportunity for Dawson regardless of how oil prices move:

"When the price of oil is high everyone wants to find more of it. When the price drops then it becomes more crucial that an oil find is worth developing. In both cases, companies like Dawson benefit. The advantage of Dawson over the others is price and fundamentals."

TGC spreads joyful glee
TGC Industries is another seismic data provider, headquartered in Texas, to which our CAPS community has taken quite fondly. In fact, the general sentiment is that the seismic space, as a whole, offers a great way to play the high-demand energy game without having to be entirely levered to commodity prices.

According to fellow Fool and CAPS All-Star TMFMmbop:

"Drilling activity around the world is up nearly 20% year-over-year. And according to Wayne Whitener, CEO of TGC Industries, exploration and production are already drilling up everything they know about. This is where Dawson Geophysical and TCG Industries step in & Market outperformance, thy name is small cap energy."

Little toy trains, little toy Tricos
Trico Marine Services, provider of marine support vessels to the oil and gas industry, offers yet another seemingly inexpensive way to play the energy boom. For the most recent quarter, Trico Marine reported record revenues, operating income, and net income, while pursuing opportunities in high-growth markets like West Africa and Southeast Asia.

Helpful pitcher SeekBalance sums up the investment case here:

"New vessels coming on line; industry demand exceeds supply. Sound balance sheet, good track record of growth, low P/E and PEG ratios, few competitors in niche."

Pioneering holiday spirit
Last, and certainly least expensive, is Pioneer Companies, producer of chlorine-, acid-, and bleach-related products. Although the business is about as exciting as receiving a pair of tube socks on Christmas morning, recent land sales and strong operating performance have given the shares a nice boost over the past few months. According to one CAPS player, mflongterm, the waters of Pioneer's stock are also chlorine-clean:

"Solid business selling a 'boring' product. Revenues are increasing year after year. Insiders own about 15% of the stock, and the valuation numbers look good (low PE, PEG, and P/B ratio looks healthy). Profit margin is above 7%. Debt is higher than I would like, but at manageable levels."

The Foolish bottom line
As always, what we say here isn't meant to be taken as a formal recommendation; we want only to generate some possible ideas that you might find worth further research. If you'd like to search for Frugals of your own, read what our CAPS community thinks, or even chime in with your own opinions, click here to get in the game.

But of course, if you'd rather sit by the fireplace, sip on some eggnog, and have fully researched value investing picks come to you instead, then try our market-thumping Motley Fool Inside Value service free for 30 days. Lead advisor Philip Durell is a lot leaner than Santa, but he delivers the goodies all the same.

Starbucks, Amazon, and eBay are Motley Fool Stock Advisor picks. Dawson Geophysical is a Motley Fool Hidden Gems selection.

Foolish contributor Brian Pacampara holds no position in any of the companies mentioned. The Fool's disclosure policy is always great for the holidays.