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As of Aug. 6, the following stocks appear underestimated by the market, as their price-earnings ratios without non-recurring items (NRI) trade below 20 while their price-earnings to growth (PEG) ratios trade near or below 1.
Furthermore, Wall Street sell-side analysts have recommended positive ratings for them, which indicates that they expect higher share prices over the months ahead.
The Container Store Group Inc
The first company that matches the criteria is The Container Store Group Inc (NYSE:TCS), a Coppell, Texas-based operator of 93 stores across 33 states in the U.S. and the District of Columbia where consumers can purchase storage and organization products and solutions.
As of Aug. 6, the price-earnings ratio without NRI is 9.66, which is more compelling than the industry median of 20.54, while the PEG ratio of 0.77 is more compelling than the industry median of 1.44.
On Aug. 6, the closing price was $11.21 per share. The share price has increased by 228% over the past year for a market capitalization of $566.41 million and a 52-week range of $3.20 to $19.31.
As of August, Wall Street sell-side analysts recommend a median rating of hold and an average target price of $14 per share for the stock.
Lakeland Industries Inc
The second company that matches the criteria is Lakeland Industries Inc (NASDAQ:LAKE), a Decatur, Alabama-based manufacturer and seller of industrial protective clothing and accessories to global markets.
As of Aug. 6, the price-earnings ratio without NRI is 6.34, which is more appealing than the industry median of 20.15, while the PEG ratio is 0.46, which has more appeal than the industry median of 2.3.
The closing price on Aug. 6 was $24.20 per share. Compared to the year-ago levels, the share price represents a 1% increase. The market capitalization is $188.89 million and the 52-week range is $17.88 to $47.94.
As of August, Wall Street sell-side analysts recommend a median rating of buy for the stock and have established an average target price of $40 per share.
Mercury General Corp
The third company is Mercury General Corp (NYSE:MCY), a Los Angeles, California-based seller of automobile insurance and homeowners' insurance products to consumers in several states in the U.S. The company reaches its clients either directly or through a network of independent agents and insurance agencies.
As of Aug. 6, the price-earnings ratio without NRI is 5.31, which is more compelling than the industry median of 11.68, while the PEG ratio of 0.17 is also more compelling than the industry median of 1.16.