10 New 5-Star Stocks This Week

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Once a week, we screen the US-listed stocks under Morningstar’s coverage for newly undervalued names—those whose prices have just fallen into ranges worthy of 4- or 5-star

. For the week ended Sept. 25, 41 stocks saw their ratings change to 4 stars, while 10 joined the 68 US-listed names in 5-star territory.

The five new 5-star stocks with the largest market capitalization are:

• Sanofi SNY
• LPL Financial Holdings LPLA
• Edison International EIX
• SBA Communications SBAC
• Stellantis STLA

The full list of new 5-star stocks is at the bottom of this story. All returns in this article are reported in the stock’s base currency, and all data is sourced from Morningstar Direct.

What Is the Morningstar Rating for Stocks?

The Morningstar Rating can help investors identify stocks that are truly undervalued or overvalued, cutting through the market noise. The rating is determined by three factors: a stock’s price, its

—Morningstar’s estimate of its intrinsic worth—and its , which captures the range of potential outcomes for that estimate. Stocks rated 4 or 5 stars are considered undervalued, those rated 3 stars are fairly valued, and the ones rated 1 or 2 stars are considered overvalued.

The Latest Stock Valuation Changes

The Morningstar US Total Market Index rose 1.11% over the past week as of Sept. 25, leaving the overall US stock market moderately undervalued, hovering at an 8% discount to its fair value estimate on a market cap-weighted basis.

Of the 872 US-listed stocks covered by Morningstar analysts:

• 43% are undervalued, 38% are fairly valued, and 19% are overvalued.
• 41 are newly undervalued.
• 13 are newly overvalued.
• 10 moved from a 4-star rating to a 5-star rating.
• Zero moved from a 5-star rating to a 4-star rating.
• None of the newly undervalued stocks jumped from a 3-star rating to a 5-star rating.
• Nine are no longer undervalued.

Metrics for This Week’s New 5-Star Stocks

Sanofi SNY

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $63.00
• Uncertainty Rating: Medium

Drug manufacturer Sanofi lost 3.23% over the past week, shifting its Morningstar Rating to 5 stars from 4. Sanofi has dropped 1.65% over the past three months and 3.70% over the past year. The stock trades at a 35% discount to its fair value estimate of $63 per share, with an Uncertainty Rating of Medium. Sanofi is a large-value company with a narrow economic moat.

LPL Financial Holdings LPLA

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $543.00
• Uncertainty Rating: High

Following a 4.18% loss over the past week, capital markets company LPL saw its Morningstar Rating move to 5 stars from 4. LPL has gained 13.44% over the past three months and has lost 6.25% over the past year. The mid-growth stock has a wide economic moat. LPL is trading at a 42% discount to its fair value estimate of $543 per share, with an Uncertainty Rating of High.

Edison International EIX

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $81.00
• Uncertainty Rating: Medium

Regulated electric company Edison dropped 4.81% over the past week, bumping its Morningstar Rating to 5 stars from 4. The company’s stock is down 28.75% over the past three months and is up 2.79% over the past year. The stock’s price is 35% below its fair value estimate of $81 per share, with an Uncertainty Rating of Medium. The mid-value stock has a narrow economic moat.

SBA Communications SBAC

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $250.00
• Uncertainty Rating: Medium

Following a 6.97% loss over the past week, specialty REIT SBA saw its Morningstar Rating move to 5 stars from 4. SBA has lost 7.54% over the past three months and 12.80% over the past year. The mid-core stock has a narrow economic moat. SBA is trading at a 34% discount to its fair value estimate of $250 per share, with an Uncertainty Rating of Medium.

Stellantis STLA

• Morningstar Rating: ★★★★★
• Fair Value Estimate: $10.00
• Uncertainty Rating: Very High

Auto manufacturer Stellantis lost 4.56% over the past week, shifting its Morningstar Rating to 5 stars from 4. Stellantis has dropped 19.86% over the past three months and 50.59% over the past year. The stock is trading at a 54% discount to its fair value estimate of $10 per share, with an Uncertainty Rating of Very High. Stellantis is a large-value company with no economic moat.