Value stocks typically trade at discounts to the broader market, offering patient investors the opportunity to buy businesses when they’re out of favor. The key risk, however, is that these stocks are usually cheap for a reason – five cents for a piece of fruit may seem like a great deal until you find out it’s rotten.
This distinction between true value and value traps can challenge even the most skilled investors. Luckily for you, we started StockStory to help you uncover exceptional companies. Keeping that in mind, here is one value stock with strong fundamentals and two best left ignored.
Two Value Stocks to Sell:
Avantor (AVTR)
Forward P/E Ratio: 12.3x
With roots dating back to 1904 and embedded in virtually every stage of scientific research and production, Avantor (NYSE: AVTR) provides mission-critical products, materials, and services to customers in biopharma, healthcare, education, and advanced technology industries.
Why Does AVTR Give Us Pause?
- Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
- Demand will likely be weak over the next 12 months as Wall Street expects flat revenue
- Free cash flow margin dropped by 4.5 percentage points over the last five years, implying the company became more capital intensive as competition picked up
Avantor’s stock price of $13.38 implies a valuation ratio of 12.3x forward P/E. If you’re considering AVTR for your portfolio, see our FREE research report to learn more.
Voya Financial (VOYA)
Forward P/E Ratio: 8.6x
Originally spun off from Dutch financial giant ING in 2013 and rebranded with a name suggesting "voyage," Voya Financial (NYSE: VOYA) provides workplace benefits and savings solutions to U.S. employers, helping their employees achieve better financial outcomes through retirement plans and insurance products.
Why Does VOYA Worry Us?
- Sales trends were unexciting over the last five years as its 6.9% annual growth was below the typical financials company
- Incremental sales over the last two years were less profitable as its earnings per share were flat while its revenue grew
- Annual tangible book value per share declines of 16.4% for the past five years show its capital management struggled during this cycle
At $75.88 per share, Voya Financial trades at 8.6x forward P/E. Dive into our free research report to see why there are better opportunities than VOYA.
One Value Stock to Buy:
Synchrony Financial (SYF)
Forward P/E Ratio: 8.7x
Powering over 73 million active accounts and partnerships with major brands like Amazon, PayPal, and Lowe's, Synchrony Financial (NYSE: SYF) provides credit cards, installment loans, and banking products through partnerships with retailers, healthcare providers, and digital platforms.
Why Will SYF Beat the Market?
- Performance over the past five years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
- Impressive 21.7% annual tangible book value per share growth over the last two years indicates it’s building equity value this cycle
- Industry-leading 22.4% return on equity demonstrates management’s skill in finding high-return investments
Synchrony Financial is trading at $74.25 per share, or 8.7x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free.
High-Quality Stocks for All Market Conditions
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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