30 New 4-Star Stocks This Week

Every Monday morning, get Morningstar’s insights on company news, the latest stock market trends, and in-depth company reports from our analysts. Sign up for our Stock Strategist newsletter here.

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. 11, 30 stocks saw their ratings change to 4 stars, while four joined the 47 US-listed names in 5-star territory.

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

• ServiceNow NOW
• Booking Holdings BKNG
• British American Tobacco BTI
• Stryker SYK
• General Dynamics GD

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 Total Market Index fell 0.91% over the past week as of Sept. 11, 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 880 US-listed stocks covered by Morningstar analysts:

• 36% are undervalued, 44% are fairly valued, and 20% are overvalued.
• 30 are newly undervalued.
• Six are newly overvalued.
• Four moved from a 4-star rating to a 5-star rating.
• Two moved from a 5-star rating to a 4-star rating.
• Among the newly undervalued stocks, zero jumped from a 3-star rating to a 5-star rating.
• Three are no longer undervalued.

Metrics for This Week’s New 4-Star Stocks

ServiceNow NOW

• Morningstar Rating: ★★★★
• Fair Value Estimate: $165
• Uncertainty Rating: High

Software application firm ServiceNow dropped 6.18% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is up 28.57% over the past three months and is down 29.38% over the past year. The stock’s price is 20% below its fair value estimate of $165, with an Uncertainty Rating of High. The large-growth stock has a narrow economic moat.

Booking Holdings BKNG

• Morningstar Rating: ★★★★
• Fair Value Estimate: $217
• Uncertainty Rating: High

Travel services company Booking Holdings lost 9.80% over the past week, shifting its Morningstar Rating to 4 stars from 3. Booking Holdings has climbed 6.57% over the past three months and has dropped 20.19% over the past year. The stock is trading at a 20% discount to its fair value estimate of $217, with an Uncertainty Rating of High. Booking Holdings is a large-core company with a wide economic moat.

British American Tobacco BTI

• Morningstar Rating: ★★★★
• Fair Value Estimate: $63
• Uncertainty Rating: Medium

Tobacco company British American Tobacco dropped 0.20% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is down 8.77% over the past three months and is up 2.12% over the past year. The stock’s price is 12% below its fair value estimate of $63, with an Uncertainty Rating of Medium. The large-value stock has a wide economic moat.

Stryker SYK

• Morningstar Rating: ★★★★
• Fair Value Estimate: $316
• Uncertainty Rating: Medium

Following a 9.10% loss over the past week, medical devices company Stryker saw its Morningstar Rating move to 4 stars from 3. Stryker has lost 9.59% over the past three months and 28.39% over the past year. The large-value stock has a wide economic moat. Stryker is trading at a 13% discount to its fair value estimate of $316, with an Uncertainty Rating of Medium.

General Dynamics GD

• Morningstar Rating: ★★★★
• Fair Value Estimate: $407
• Uncertainty Rating: Medium

Aerospace and defense company General Dynamics dropped 0.97% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is down 0.40% over the past three months and is up 9.88% over the past year. The stock’s price is 13% below its fair value estimate of $407, with an Uncertainty Rating of Medium. The large-value stock has a wide economic moat.