I am always looking for a good deal, whether that means buying an extra box of Frosted Flakes 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 tells us, by way of allegory, how we can look out for these situations.

In The Intelligent Investor, Graham introduces readers to a wacky guy 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.

So 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:

Stock

Monthly Return

1-Year Return

Current CAPS Rating

Frontier Oil (NYSE:FTO)

(23%)

(57.9%)

****

Eaton Corp. (NYSE:ETN)

(21.6%)

(27.1%)

*****

Cognizant Technology Solutions (NASDAQ:CTSH)

(20.5%)

(34.7%)

*****

Chesapeake Energy (NYSE:CHK)

(20%)

43.8%

*****

Foster Wheeler (NASDAQ:FWLT)

(19.9%)

(3.5%)

*****

EOG Resources (NYSE:EOG)

(18.3%)

48.2%

****

Anadarko Petroleum (NYSE:APC)

(17.5%)

19.2%

*****

Data from Motley Fool CAPS as of July 22.

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 some further research. I'll even get you started with some thoughts on Eaton.

Why so blue?
Good earnings, bad guidance. Get used to it, because that's a refrain we're likely to hear a lot this earnings season -- that is, for companies that manage to swing good earnings. And just like President Bush trying to pronounce "nuclear," the phrase is likely to make people uncomfortable every time they hear it.

For industrial manufacturer Eaton, the earnings were $2.03 per share, an increase of 24% from the prior year. The growth reflected a heavy dose of acquisitions -- Eaton's primary growth driver -- coupled with organic growth and some benefit from exchange rates. Meanwhile, the outlook was that the spike in oil prices would hamper Eaton's transportation end markets, and as a result the company reduced 2008 earnings guidance by a whopping 3%.

Investors took this like a belch at the dinner table and were tripping over themselves to sell.

What the bulls say
Having a diversified business is a lot like visiting the food court at a mall -- if you're not in the mood for Chinese, you can help yourself to a taco or a hamburger instead.

For Eaton, the price of oil put the squeeze on its auto segment in the second quarter, and operating income fell by around 25% from the prior year. That's hardly something to be excited about, but automotive is also the company's smallest segment. And while the auto segment was struggling, other segments at Eaton were looking pretty darn good.

It would seem that in a market like this, a company without exposure to mortgage securities or direct consumer spending should be what investors are seeking out. Instead, it's been sold down to less than 10 times forward earnings.

But if Mr. Market doesn't agree that Eaton's stock is a deal, the members of the CAPS community certainly seem to. A total of 433 members have rated Eaton an outperformer, against just 10 who think it will underperform the broader market. CAPS All-Star reddingrunner recently gave Eaton a thumbs-up, saying:

I'm a big fan of these industrial infrastructure plays; companies like Eaton and its competitors who provide the moving parts for the industrialization of emerging markets. Eaton is cheap and poised for growth.

So do you think the recent drop has created a good buying opportunity? Or is there more downside ahead? Let the community know what you think -- head over to CAPS and share your thoughts with the other 110,000-plus players currently part of the community. Even if you'd prefer to pass on Eaton, you can check out a couple of the other stocks listed above, or any of the 5,500 stocks that are rated on CAPS.

More CAPS Foolishness:

Chesapeake Energy is a Motley Fool Inside Value recommendation. Try any of our Foolish newsletters today, free for 30 days.

Fool contributor Matt Koppenheffer does not own shares of any of the companies mentioned. You can check out what Matt likes in CAPS by visiting his CAPS portfolio. The Fool’s disclosure policy knows how to drop a stock like it's hot, but only when the company is truly cold.