I'm 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 it's 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. Mr. Market's game is to pay you house calls on a daily basis, offering 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, promising you premium prices for your holdings. At other times, he'll be inconsolably depressed about the future, and he'll want to sell you what he has for as low as pennies on the dollar.

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 has earned one of the two highest ratings from CAPS members:


30-day return

One-year return

Current CAPS rating

US Bancorp (NYSE: USB)




Zimmer Holdings (NYSE: ZMH)




Trinity Industries (NYSE: TRN)




International Game Technology (NYSE: IGT)




Caterpillar (NYSE: CAT)




Data from Motley Fool CAPS as of June 15.

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, let's take a closer look at whether opportunity could be staring us in the face.

Why so blue?
You don't have to look too hard to find stocks that were slumping over the past month. The entire market has been in the dumps. Much of the concern has been due to general concerns about the economy and the state of the recovery.

For Trinity Industries and Caterpillar, those concerns are paramount. Trinity is a diversified industrial manufacturer that produces rail cars, construction products, energy equipment, and inland barges. For much of Trinity's business, positive economic momentum is a must, so it's no surprise that recent double-dip recession concerns have hit the company's stock. Similarly, investors may be worried that a teetering global economy will soften demand for Caterpillar's heavy-duty equipment and engines.

And while US Bancorp is in a very different industry than Trinity and Cat, it's not surprising to see its stock react to economic concerns, either. As my fellow Fool Alex Dumortier pointed out back in April, USB's first-quarter earnings suggested that credit problems are reaching a turning point. However, it wasn't a particularly emphatic turning point, and investors are no doubt wary of those credit indicators starting to pitch again.

Over the past month, a new debt offering and a restatement of second-quarter earnings may have weighed on International Game Technology's stock, though it's unclear that either had a major impact. In a continuation of the theme from above, though, economic concerns likely had a role in IGT's decline as well.

The majority of IGT's installed base of gaming machines brings revenue to the company through a variable fee, based on how much betting action those machines see. Renewed economic weakness would likely drag down the betting action at the slots, which would take a bite out of the company's revenue.

Finally, we have Zimmer. Of course, we can't count out economic concerns here, either, but Zimmer may also still be weighed down by the health-care reform bill passed earlier this year. Some investors fear that new rules under the bill would give hospitals more negotiating power, which could weigh on product prices for Zimmer and competitors like Stryker (NYSE: SYK), as well as other medical-device manufacturers such as Medtronic (NYSE: MDT).

Picking a winner
The CAPS community obviously has a high opinion of all of these stocks, and I can't help but agree that, for the most part, these are mighty fine companies. But which might be the best opportunity of the bunch? Thanks to an attractive valuation and favorable demographic trends, I'd go with Zimmer.

With a huge overall addressable market and healthy market share in key markets such as knee and hip replacements, Zimmer seems well-positioned to crank the growth back up. While the company does face tough competition -- from the likes of Stryker, Smith & Nephew, and others -- along with uncertainty from the health bill, the stock's 2010 earnings multiple of 12.7 should be able to cushion a fair amount of downside.

Back in 2006, MCKInathan, one of the CAPS community's top-rated members, gave Zimmer a thumbs-up, citing the demographic trends playing in the company's favor:

Ok so the US is about to see the largest population of senior citizens ever. What does this mean? Well besides staying off the roads in the next few years, it means more hip, knee, ankle, pelvic replacements than ever. [Zimmer] is the largest manufactorer of replacement body parts and americans are going to need it, especially since so many of us are overweight.

I've given Zimmer a thumbs-up in my CAPS portfolio. But here's the important question: what do you think? Head over to CAPS and share your thoughts with the other 165,000-plus members currently part of the community.

Does the phrase "wildly mispriced stock" make your mouth water? If so, Anand Chokkavelu may have something to quench your investment thirst.

Stryker is a Motley Fool Inside Value selection. The Fool owns shares of Medtronic and Stryker.

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 or you can connect with Matt on Twitter @KoppTheFool. The Fool's disclosure policy offers you one Schrute buck for reading this far.