Morningstar

22 New 4-Star Stocks This Week

Alphabet and Berkshire Hathaway are among the stocks that fell into undervalued territory.

The Alphabet (Google) logo is seen displayed on a smartphone screen.
Thomas Fuller/SOPA Images via Getty
Securities in This Article
Alphabet Inc Class A
(GOOGL)
AppLovin Corp Ordinary Shares - Class A
(APP)
Micron Technology Inc
(MU)
Berkshire Hathaway Inc Class A
(BRK.A)
Autodesk Inc
(ADSK)

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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

Morningstar Ratings
. For the week ended March 27, 22 stocks saw their ratings change to 4 stars, while 13 joined the 85 US-listed names in 5-star territory.

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

fair value estimate
—Morningstar’s estimate of its intrinsic worth—and its
Uncertainty Rating
, 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 fell 1.99% over the past week as of March 27, leaving the overall US stock market significantly undervalued, hovering at a 15% discount to its fair value estimate on a market-cap-weighted basis.

Of the 831 US-listed stocks covered by Morningstar analysts:

  • 44% are undervalued, 40% are fairly valued, and 17% are overvalued.
  • 22 are newly undervalued.
  • 12 are newly overvalued.
  • 13 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 4-Star Stocks

Alphabet

  • Morningstar Rating: ★★★★
  • Fair Value Estimate: $340.00
  • Uncertainty Rating: Medium

Internet content company Alphabet lost 8.86% over the past week, shifting its Morningstar Rating to 4 stars from 3. Alphabet has dropped 12.43% over the past three months and has climbed 69.68% over the past year. The stock is trading at a 19% discount to its fair value estimate of $340 per share, with an Uncertainty Rating of Medium. Alphabet is a large-core company with a wide economic moat.

Berkshire Hathaway

  • Morningstar Rating: ★★★★
  • Fair Value Estimate: $765,000.00
  • Uncertainty Rating: Low

Following a 2.36% loss over the past week, diversified insurance firm Berkshire Hathaway saw its Morningstar Rating move to 4 stars from 3. Berkshire has lost 5.80% over the past three months and 12.25% over the past year. The large-value stock has a narrow economic moat. Berkshire is trading at an 8% discount to its fair value estimate of $765,000 per share, with an Uncertainty Rating of Low.

Micron Technology

  • Morningstar Rating: ★★★★
  • Fair Value Estimate: $455.00
  • Uncertainty Rating: High

Semiconductor company Micron lost 15.53% over the past week, shifting its Morningstar Rating to 4 stars from 3. Micron has climbed 25.48% over the past three months and 293.15% over the past year. The stock is trading at a 21% discount to its fair value estimate of $455 per share, with an Uncertainty Rating of High. Micron is a large-core company with no economic moat.

AppLovin

  • Morningstar Rating: ★★★★
  • Fair Value Estimate: $500.00
  • Uncertainty Rating: Very High

Following a 13.83% loss over the past week, advertising agency AppLovin saw its Morningstar Rating move to 4 stars from 3. AppLovin has lost 46.63% over the past three months and has gained 45.66% over the past year. The large-growth stock has a narrow economic moat. AppLovin is trading at a 24% discount to its fair value estimate of $500 per share, with an Uncertainty Rating of Very High.

Autodesk

  • Morningstar Rating: ★★★★
  • Fair Value Estimate: $275.00
  • Uncertainty Rating: Medium

Software application firm Autodesk dropped 7.32% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is down 23.57% over the past three months and 14.81% over the past year. The stock’s price is 16% below its fair value estimate of $275 per share, with an Uncertainty Rating of Medium. The mid-growth 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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