America's Next Top Value Stock

Though value investors have been some of the most successful investors out there, finding good stocks at bargain prices is far from easy. Though markets aren't as efficient as some university professors may want to tell you, they generally do a pretty good job pricing stocks. So while there are good deals out there, you're going to have to break a bit of a mental sweat if you want to make sure that you're investing in the stock equivalent of Brad Pitt, not Kato Kaelin.

Fortunately for us, in the search for stock market values, we have the 145,000 members of The Motley Fool's CAPS community voting on which stocks are true stars and which are just posers. To gather some ideas I've dug up a handful of companies valued at less than twice their book value -- a measure often used by value investors.

Sources: Yahoo! Finance and CAPS as of Jan. 21.

As you can see, though these stocks all carry value-like multiples, the CAPS community doesn't think that all are worthy of your investment dollars.

No twinkle in these stars
There's no two ways about it, Morgan Stanley's fourth-quarter earnings report was disappointing. But at least it wasn't alone. If you adjust for the fact that Goldman Sachs drastically cut its compensation expense during the quarter, its earnings weren't terribly impressive, and there was little jubilation over the earnings at Bank of America (NYSE:BAC) or Citigroup.

And while the "crisis" aspect of the financial crisis may be over, that doesn't mean that these goliaths are out of the spotlight. Investors in major financial companies were treated to an additional scare yesterday, when President Obama started talking tough on banking regulation.

Of course, Morgan Stanley isn't the only financial company in the penalty box. CAPS members have been particularly bearish on Capital One, and the stock carries a rock-bottom, one-star rating. Though the company blew out fourth-quarter earnings expectations, management nipped any excitement in the bud by claiming that new regulations would likely hamper future growth.

And while GameStop's CAPS rating isn't quite as low as Morgan Stanley's or Capital One's, this stock seems to be caught between the very bullish and the very bearish. Fans of the stock tout the current low price and the fact that the company reels in big bucks from video game diehards. Critics, however, question the company's ability to even exist in the future, as digital distribution takes a bigger hold in the video game industry.

A five-star is born!
CAPS members may not be too taken with GameStop, but they seem to have a better view of video game designer Take-Two Interactive. This Motley Fool Rule Breakers pick may be small-fry compared to the likes of Electronic Arts and Activision Blizzard (NASDAQ:ATVI), but with major titles such as Grand Theft Auto and BioShock under its belt, it may have what it takes to tussle with the big boys.

But while Take-Two's four-star rating makes it worth keeping on your radar, it didn't quite have the votes to beat out this week's top value stock, BP.

Now hang on there, cover that yawn and listen for a moment. I'll admit it; a giant oil major like BP may not be all that exciting. But do we really need excitement? Or do we want performance? Trading at 1.9 times its book value, BP is noticeably cheap compared to its historical trading range. And with a hefty 5.4% dividend, you don't have to wait for this stock to start rewarding you.

CAPS All-Star turdburglar became a fan of BP earlier this month, and kept it nice and simple:

Excellent for buy and hold. Check out that fat dividend. And do you really think oil prices will go down in the long run? This one is a cakewalk.

Make your vote count!
I've already given BP an outperform rating in my CAPS portfolio, but what do you think? Do you agree that BP could be America's next top value stock? Click over to CAPS and let the rest of the community know what you think. And while you're there, you can log your vote for the other stocks that you think should be in the running.

I happen to think that value is crucial when it comes to investing, but not everybody feels the same way. Has our modern world killed value investing?