17 New 4-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 May 22, 17 stocks saw their ratings change to 4 stars, while eight joined the 86 US-listed names in 5-star territory.

The five new 4-star stocks with the largest market capitalization are:

• Nvidia NVDA
• Blackstone BX
• Lowe’s LOW
• Automatic Data Processing ADP
• Kohlberg Kravis Roberts KKR

The full list of new 4-star stocks can be found 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 Market Index rose 1.08% over the past week as of May 22, leaving the overall US stock market moderately undervalued, hovering at a 6.00% discount to its fair value estimate on a market-cap-weighted basis.

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

• 42% are undervalued, 36% are fairly valued, and 21% are overvalued.
• 17 are newly undervalued.
• 13 are newly overvalued.
• Eight moved from a 4-star rating to a 5-star rating.
• Six 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.
• 11 are no longer undervalued.

Metrics for This Week’s New 4-Star Stocks

Nvidia

• Morningstar Rating: ★★★★
• Fair Value Estimate: $280.00
• Uncertainty Rating: Very High

Semiconductor company Nvidia dropped 4.43% over the past week. The company’s stock is up 13.45% over the past three months and 62.15% over the past year. The stock’s fair value estimate rose to $280 per share from $260 during the week. It ended the week trading at a 23% discount to its new fair value estimate, with an Uncertainty Rating of Very High. The large-growth stock has a wide economic moat.

Blackstone

• Morningstar Rating: ★★★★
• Fair Value Estimate: $140.00
• Uncertainty Rating: High

Following a 0.53% gain over the past week, asset management firm Blackstone saw its Morningstar Rating move to 4 stars from 3. Blackstone has lost 1.35% over the past three months and 10.32% over the past year. The large-core stock has a wide economic moat. Blackstone is trading at a 15% discount to its fair value estimate of $140 per share, with an Uncertainty Rating of High.

Lowe’s

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

Home improvement retail company Lowe’s dropped 1.55% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is down 22.93% over the past three months and 2.02% over the past year. The stock’s price is 14% below its fair value estimate of $250 per share, with an Uncertainty Rating of Medium. The large-value stock has a wide economic moat.

Automatic Data Processing

• Morningstar Rating: ★★★★
• Fair Value Estimate: $249.00
• Uncertainty Rating: Medium

Software application firm ADP gained 5.05% over the past week. ADP has climbed 5.91% over the past three months and has dropped 28.20% over the past year. The stock’s fair value estimate rose to $249 per share from $231 during the week. It ended the week trading at a 10% discount to its new fair value estimate, with an Uncertainty Rating of Medium. ADP is a mid-core company with a narrow economic moat.

Kohlberg Kravis Roberts

• Morningstar Rating: ★★★★
• Fair Value Estimate: $115.00
• Uncertainty Rating: High

Asset management firm KKR dropped 3.02% over the past week, bumping its Morningstar Rating to 4 stars from 3. The stock is down 6.87% over the past three months and 19.90% over the past year. The stock’s price is 18% below its fair value estimate of $115 per share, with an Uncertainty Rating of High. The large-core stock has a narrow economic moat.