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7 Highly Rated Stocks on Sale

By Matt Koppenheffer - Updated Apr 5, 2017 at 6:52PM

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Check out these highly-rated stocks that have had a big price cut in the past month.

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 its 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. His 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

30-day
return

One-year
return

Current CAPS rating
(5 stars max.)

SandRidge Energy (NYSE:SD)

(27.1%)

(83.8%)

*****

3M (NYSE:MMM)

(9.6%)

(33.8%)

*****

Noble (NYSE:NE)

(9.2%)

(62.2%)

*****

PPL Corp. (NYSE:PPL)

(9.1%)

(43.2%)

****

Procter & Gamble (NYSE:PG)

(5.2%)

(17.3%)

*****

Williams Companies (NYSE:WMB)

(4.6%)

(62.3%)

****

Duke Energy (NYSE:DUK)

(4%)

(25.8%)

*****

Data from Motley Fool CAPS as of Dec. 23.

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 SandRidge Energy.

Why so blue?
At this point it seems that stopping the plunge of oil and gas prices would be like trying to calmly negotiate with Bruce Banner after he's started to turn green. Like the Hulk's fist, energy prices have continued to bash their way down to ever lower levels and companies that produce oil and gas and provide oilfield services are smarting.

SandRidge Energy happens to partake in both segments, and the drop in oil and gas has hammered SandRidge's stock price. Though the company's third quarter results didn't reflect the worst of the declines, investors clearly think the coming quarters will be pretty ugly. SandRidge has also cut back on its investments thanks to the deteriorating environment. For 2009, the company now plans to invest just $500 million -- half of what it originally planned. It also decided to cut back on the number of rigs it has running from 47 in September to 12 by year end.

What the bulls say
Though energy prices have taken their lumps recently, there are plenty of investors that think the crash will prove to be short lived. For those investors, the rock bottom prices that energy companies are now trading at look like scorching deals. SandRidge's stock is one that falls squarely into this category for many CAPS members. Of the 461 CAPS members that have weighed in on SandRidge, 448 of them have rated it an outperformer.

CAPS All-Star dexion10 provided the most recent bullish pitch on SandRidge, writing: "sandridges enterprise value is below the cost of the proven reserves... it's one of the only HIGH QUALITY NAT GAS COMPANIES where that is true." Fellow SandRidge bull tekon55 recently added:

A Boone Pickens darling. Once the temporary downturn in Demand is realized to be a media creation for the most part, and all the canceled oil drilling and production projects diminish supply far beyond any conceiveable reality for the Demand that has remained real in the real world, the stock will rocket back up to its pre-panic levels...

So do you think the recent drop has created a good buying opportunity? Or will SandRidge continue to be dragged down by the lackluster energy market? Let the community know what you think -- head over to CAPS and share your thoughts with the other 125,000 members currently part of the community. Even if you'd prefer to pass on SandRidge, you can check out a couple of the other stocks listed above or any of the 5,400 stocks that are rated on CAPS.

More CAPS Foolishness:

On Jan. 12, 2009, Fool co-founder David Gardner, Jeff Fischer, and their Motley Fool Pro team will accept new subscribers to their real-money portfolio service. Motley Fool Pro is investing $1 million of the Fool's own money in long and short positions in a range of securities, including common stocks, put and call options, and exchange-traded funds (ETFs). They also incorporate proprietary CAPS "community intelligence" data into their research. To learn more about Motley Fool Pro and to receive a private invitation to join, simply enter your email address in the box below.

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. Duke Energy is a Motley Fool Income Investor recommendation. 3M is an Inside Value selection. The Fool's disclosure policy offers you one Schrute buck for reading this far.

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Stocks Mentioned

The Procter & Gamble Company Stock Quote
The Procter & Gamble Company
PG
$146.67 (0.97%) $1.41
The Williams Companies, Inc. Stock Quote
The Williams Companies, Inc.
WMB
$34.16 (0.65%) $0.22
Noble Corporation plc Stock Quote
Noble Corporation plc
NEBLQ
3M Company Stock Quote
3M Company
MMM
$152.24 (1.72%) $2.58
Duke Energy Corporation Stock Quote
Duke Energy Corporation
DUK
$110.25 (1.60%) $1.74
PPL Corporation Stock Quote
PPL Corporation
PPL
$30.29 (2.92%) $0.86

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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