22 New 4-Star Stocks This Week
IBM and Arista are among the stocks that fell into undervalued territory.
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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
The five new 4-star stocks with the largest market capitalization are:
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
The Latest Stock Valuation Changes
The Morningstar US Market Index fell 1.29% over the past week as of Feb. 13, 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 828 US-listed stocks covered by Morningstar analysts:
- 35% are undervalued, 39% are fairly valued, and 26% are overvalued.
- 22 are newly undervalued.
- 25 are newly overvalued.
- Seven moved from a 4-star rating to a 5-star rating.
- Seven 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.
- 32 are no longer undervalued.
Metrics for This Week’s New 4-Star Stocks
IBM
- Morningstar Rating: ★★★★
- Fair Value Estimate: $325.00
- Uncertainty Rating: Medium
Information technology services company IBM dropped 11.72% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is down 13.44% over the past three months and is up 3.77% over the past year. The stock’s price is 19% below its fair value estimate of $325 per share, with an Uncertainty Rating of Medium. The large-core stock has a narrow economic moat.
Arista Networks
- Morningstar Rating: ★★★★
- Fair Value Estimate: $175.00
- Uncertainty Rating: High
Computer hardware company Arista gained 2.98% over the past week. Arista has climbed 8.66% over the past three months and 29.01% over the past year. The stock’s fair value estimate rose to $175 per share from $140 during the week. It ended the week trading at a 19% discount to its new fair value estimate, with an Uncertainty Rating of High. Arista is a large-growth company with a wide economic moat.
Charles Schwab
- Morningstar Rating: ★★★★
- Fair Value Estimate: $111.00
- Uncertainty Rating: Medium
Capital markets company Schwab dropped 10.51% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is down 1.1% over the past three months and is up 16.7% over the past year. The stock’s price is 16% below its fair value estimate of $111 per share, with an Uncertainty Rating of Medium. The large-core stock has a wide economic moat.
Booking Holdings
- Morningstar Rating: ★★★★
- Fair Value Estimate: $5,300.00
- Uncertainty Rating: High
Travel services company Booking lost 7.10% over the past week, shifting its Morningstar Rating to 4 stars from 3. Booking has dropped 18.27% over the past three months and 16.72% over the past year. The stock is trading at a 22% discount to its fair value estimate of $5,300 per share, with an Uncertainty Rating of High. Booking is a large-core company with a wide economic moat.
Intercontinental Exchange
- Morningstar Rating: ★★★★
- Fair Value Estimate: $174
- Uncertainty Rating: Low
Financial data firm Intercontinental Exchange dropped 9.89% over the past week. The company’s stock is up 0.02% over the past three months and is down 8.64% over the past year. The stock’s fair value estimate rose to $174 per share from $170 during the week. It ended the week trading at a 12% discount to its new fair value estimate, with an Uncertainty Rating of Low. The large-core stock has a wide economic moat.
This article was generated with the help of automation and reviewed by Morningstar editors. Learn more about Morningstar’s use of automation.
The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.
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