t's been a wild year for investors. Markets have been volatile, cryptocurrencies and meme stocks have posted explosive gains, and winning high-risk plays will probably take center stage when analysts serve up their 2021 retrospectives. In this environment, there's plenty of excitement around growth stocks, but smart investors could do themselves a favor by giving some attention to top value names, especially those that are trading at discounted levels.
Value stocks are those stocks that are considered to be under-valued in the stock market. Many investors believe that market over reacts to any news, resulting in stock price changes which do not accurately depict the strength of the underlying fundamentals of the company. Hence, such stocks that are currently trading at a price below the intrinsic value of their company are known as value stocks. Investing in value stocks or value investing is an approach based on the premise that the market will eventually take cognizance of the true potential of these stocks and hence the price will regain pace resulting in good profits.
How Do Value Stocks Work?
Value investing is based on the basic concept of buying and selling. If the actual value of any product is known then you can buy it at a discount and sell it at a higher value. This is how value investing for stocks works. The investor identifies the best value stock, then buys it at a discount and holds it till the time it reaches its actual value to derive huge returns.
For instance, buying a TV on sale or at full price won't make any difference in picture quality or screen size. Similarly, buying stocks at a price lower than its intrinsic value, acts as a discount on purchase of high value stocks. But, unlike TVs, sale/discount offers on stocks won't be advertised and displayed publicly. You, as a realistic and analytical investor, will have to find those stocks that are trading cheap to invest now, so that you can reap the returns in future.
7. Best Value Stocks To Buy In 2021
- The Walt Disney Company (NYSE: DIS)
- Ford Motor Company (NYSE: F)
- Teladoc Health, Inc. (NYSE: TDOC)
- DICK'S Sporting Goods, Inc. (NYSE: DKS)
- SoFi Technologies, Inc. (NASDAQ: SOFI)
- Ally Financial Inc. (NYSE: ALLY)
- Skyworks Solutions, Inc. (NASDAQ: SWKS
1. The Walt Disney Company
The Walt Disney Company commonly just Disney is an American multinational entertainment and media conglomerate headquartered at the Walt Disney Studios complex in Burbank, California.
Disney was originally founded on October 16, 1923, by brothers Walt and Roy O. Disney as the “Disney Brothers Cartoon Studio”;it also operated under the names “The Walt Disney Studio” and “Walt Disney Productions” before officially changing its name to The Walt Disney Company in 1986. The company established itself as a leader in the American animation industry before diversifying into live-action film production, television, and theme parks.
Since the 1980s, Disney has created and acquired corporate divisions in order to market more mature content than is typically associated with its flagship family-oriented brands. The company is known for its film studio division, The Walt Disney Studios, which includes Walt Disney Pictures, Walt Disney Animation Studios, Pixar, Marvel Studios, Lucasfilm, 20th Century Studios, 20th Century Animation, and Searchlight Pictures. Disney's other main business units include divisions in television, broadcasting, streaming media, theme park resorts, consumer products, publishing, and international operations. Through these various segments, Disney owns and operates the ABC broadcast network; cable television networks such as Disney Channel, ESPN, Freeform, FX, and National Geographic; publishing, merchandising, music, and theater divisions; direct-to-consumer streaming services such as Disney+, Star+, ESPN+, Hulu, and Hotstar; and Disney Parks, Experiences and Products, a group of 14 theme parks, resort hotels, and cruise lines around the world.Cartoon character Mickey Mouse, created in 1928 by Walt Disney and Ub Iwerks, serves as the company's official mascot.
The company, which trades on the New York Stock Exchange (NYSE) under DIS stock symbol, has been a component of the Dow Jones Industrial Average since 1991.In August 2020, just under two-thirds of the stock was owned by large financial institutions.
2. Ford Motor Company
(commonly known as Ford) is an American multinational automobile manufacturer headquartered in Dearborn, Michigan, United States. It was founded by Henry Ford and incorporated on June 16, 1903. The company sells automobiles and commercial vehicles under the Ford brand, and luxury cars under its Lincoln luxury brand. Ford also owns Brazilian SUV manufacturer Troller, an 8% stake in Aston Martin of the United Kingdom and a 32% stake in Jiangling Motors. It also has joint-ventures in China (Changan Ford), Taiwan (Ford Lio Ho), Thailand (AutoAlliance Thailand), Turkey (Ford Otosan), and Russia (Ford Sollers). The company is listed on the New York Stock Exchange and is controlled by the Ford family; they have minority ownership but the majority of the voting power.
3. Teladoc Health, Inc.
is a multinational telemedicine and virtual healthcare company based in the United States. Primary services include telehealth, medical opinions,AI and analytics, telehealth devices and licensable platform services. In particular, Teladoc Health uses telephone and videoconferencing software as well as mobile apps to provide on-demand remote medical care. Billed as the first and largest telemedicine company in the United States, Teladoc Health was launched in 2002 and has acquired companies such as BetterHelp in 2015,Best Doctors in 2017, and Advance Medical in 2018. It trades on the NYSE and in 2019 was active in 130 countries and served around 40 million members in 2021.
4. Dick's Sporting Goods, Inc.
(stylized as “DICK'S Sporting Goods“) is an American sporting goods retail company, based in Coraopolis, Pennsylvania. The company was established by Richard “Dick” Stack in 1948, and has approximately 854 stores and 50,100 employees. Dick's is America's largest sporting goods retailer, and it is listed on the Fortune 500.
5. SoFi Technologies, Inc.
(now the parent company of Social Finance, Inc. and commonly known as SoFi) is an American online personal finance company. Based in San Francisco, SoFi provides financial products that includes student loan refinancing, mortgages, personal loans, credit card, investing, and banking through both mobile app and desktop interfaces.
6. Ally Financial Inc.
Ally Financial is a bank holding company organized in Delaware and headquartered in Detroit, Michigan. The company provides financial services including car finance, online banking via a direct bank, corporate lending, vehicle insurance, mortgage loans, and an electronic trading platform to trade financial assets.
Ally is one of the largest car finance companies in the U.S., providing car financing and leasing for 4.5 million customers and originating 1.4 million car loans annually. It is on the list of largest banks in the United States by assets and has 2.0 million depositors. Its electronic trading platform has approximately 350,000 funded accounts. Via its SmartAuction online marketplace for auto auctions, launched in 2000, the company has sold more than 5 million vehicles, including 270,000 vehicles sold in 2019.
The company was known as GMAC, an acronym for General Motors Acceptance Corporation, until 2010.
7. Skyworks Solutions, Inc.
Skyworks Solutions, Inc. is an American semiconductor company headquartered in Irvine, California, United States.
Skyworks manufactures semiconductors for use in Radio Frequency (RF) and mobile communications systems. Its products include power amplifiers, front-end modules and RF products for handsets and wireless infrastructure equipment. The company's portfolio includes amplifiers, attenuators, circulators, demodulators, detectors, diodes, directional couplers, front-end modules, hybrids, infrastructure RF subsystems, isolators, lighting and display products, mixers, modulators, optocouplers, opto-isolators, phase shifters, PLLs/synthesizers/VCOs, power dividers/combiners, power management devices, receivers, switches and technical ceramics.