Although the Federal Reserve aggressively targeted inflation since last year, consumer prices remain stubbornly high, thus incentivizing the case for the best bargain stocks to buy this month. Let’s face it – everybody appreciates a good discount. For these securities, your money can go a lot further than your average garden-variety investment.
To be clear, with the so-called bargain stocks 2023, I’m not necessarily referring to securities with a cheap price tag. Rather, these are enterprises that are undervalued relative to a key financial metric such as earnings. This way, you’re focusing on securities that other investors may be overlooking.
At the same time, these undervalued stocks are also fiscally resilient. Otherwise, there’d be no point in listing a bunch of cheap securities just because of their price point. There are plenty of those. So, if you want a truly substantive bargain, check out the below market ideas.
| PLAB | Photronics | $14.24 |
| DSWL | Deswell Industries | $2.72 |
| TSRI | TSR. Inc. | $8.28 |
| CVR | Chicago Rivet & Machine | $26.00 |
| GRVY | Gravity | $56.98 |
| BNTX | BioNTech | $107.64 |
| VIR | Vir Biotechnology | $25.50 |
Phototronics (PLAB)
Hailing from Brookfield, Connecticut, Phototronics (NASDAQ:PLAB) is a semiconductor photomask manufacturer. According to Allied Market Research, the global photomask market size reached a valuation of $4 billion in 2018. Experts project that by 2026, the segment will hit $4.97 billion, expanding at a compound annual growth rate (CAGR) of 2.5% during the forecast period. Currently, Phototronics carries a market capitalization of just under $903 million.
In the charts, PLAB fell nearly 14% since the beginning of this year. However, that could be excessive pessimism considering the underlying enterprise’s quiet but critical relevance. Sure enough, PLAB makes a case for the best bargain stocks to buy. At the moment, shares trade at a trailing multiple of 8.07. As a discount to earnings, Phototronics ranks better than 86.57% of companies listed in the semiconductors space.
Also, the company enjoys broad financial strengths, assuaging fears of a value trap. On the balance sheet, Phototronics carries a high cash-to-debt ratio of 11.04. Operationally, its three-year revenue growth rate pings at 19.2%, outpacing 68.63% of its peers.
Deswell Industries (DSWL)
Billed as a world leader in quality, product breadth, and customer satisfaction, Deswell Industries (NASDAQ:DSWL) manufactures injection-molded plastic parts and components, electronic products and subassemblies, and metallic products for original equipment manufacturers (OEMs) and contract manufacturers. Presently, Deswell only carries a market cap of $43.35 million, basically a nano-cap example of bargain stocks in 2023.
Since the Jan. opener, DSWL slipped almost 14%. Again, though, this might be a mistake given Deswell’s industrial relevancies. Right now, the market prices DSWL at a trailing multiple of 13.27. As a discount to earnings, the company ranks better than 64.74% of sector competitors. Also, it trades at a subterranean 0.49-times tangible book value.
To be fair, Gurufocus states that Deswell may be a value trap. However, the enterprise features a stout balance sheet with zero debt, affording it incredible flexibility. Also, it enjoys a decent three-year revenue growth rate of 8.7%. Thus, it deserves consideration for bargain stocks to buy.
TSR Inc (TSRI)
Headquartered in Hauppauge, New York, TSR Inc (NASDAQ:TSRI) classifies itself as an information technology specialist. Specifically, it provides staffing services, primarily for contract IT roles along but also for opportunities outside the IT space. Fundamentally, as employers ended up hiring less-than-ideal workers during the tight labor market of the immediate post-pandemic years, TSR could see an increase in demand.
Sure enough, despite its obvious risk profile, TSRI gained over 21% of its equity value since the start of the year. Nevertheless, it still makes a case for the best bargain stocks to buy. Presently, the market prices TSRI at a trailing multiple of 12.95. As a discount to projected earnings, TSR ranks better than 83.65% of the competition. Also, it’s priced at 1.33 times the tangible book value. This compares favorably to the sector median stat of 3.68 times.
On the balance sheet, TSR enjoys a cash-to-debt ratio of 15.95, outflanking 70% of sector players. As well, its three-year revenue growth rate provides a solid showing at 12.8%. Therefore, it’s one of the cheap stocks to put on your radar.
Chicago Rivet & Machine (CVR)
Hailing from Illinois (well, obviously), Chicago Rivet & Machine (NYSEAMERICAN:CVR) manufactures mechanical, pneumatic, and hydraulic riveting equipment for numerous industries. It’s boring but that’s by design. Also, Grand View Research points out that the global riveting tools market continues to grow, estimated to be to the tune of 4.5% from 2019 to 2025.
However, investors don’t really see CVR moving, sending shares down more than 1% since the January opener. Still, the quiet fundamental relevancies of Chicago Rivet could be intriguing for patient investors. At the moment, the market prices CVR at a trailing multiple of 9.56. As a discount to earnings, the company ranks better than 82.43% of its peers.
To be fair, its revenue performance is rather mundane, printing growth of only 0.8% over the past three years. However, the company as expected is consistently profitable. Also, Chicago Rivet suffers no debt, affording incredible stability. Thus, it’s one of the bargain stocks to buy.
Gravity (GRVY)
Based in South Korea, Gravity (NASDAQ:GRVY) is a video game company known primarily for the development of Ragnarok Online, a massively popular multiplayer online role-playing game. As the World Economic Forum pointed out, the video game market booms. Further, no analyst expects circumstances to change, potentially boding well for GRVY stock.
Unsurprisingly, then, GRVY gained almost 33% of its equity value since the start of the year. In the past 365 days, GRVY gained over 11%. Financially, GRVY makes the list of best bargain stocks to buy because of its rock-bottom trailing multiple of 6.01. As a discount to earnings, Gravity ranks better than 90.85% of companies listed in the interactive media industry.
As well, GRVY trades hands at 1.53-times tangible book value, below the sector median stat of 3.09. Beyond being one of the undervalued stocks, Gravity carries zero debt. As well, its trailing-year net margin impresses at a staggering 18%.
BioNTech (BNTX)
A German biotechnology firm, BioNTech (NASDAQ:BNTX) generated positive headlines for partnering with Pfizer (NYSE:PFE) on the messenger-RNA-based vaccine for the SARS-CoV-2 virus. However, societal fears of Covid-19 faded substantially since the worst of the crisis. Since the Jan. opener, BNTX gave up 26% of its equity value. In the past one-year period, it’s down more than 27%.
Fundamentally, however, BioNTech can leverage its newfound acumen associated with mRNA-based vaccines and therapeutics. Therefore, it deserves consideration as one of the best bargain stocks to buy. At the moment, the market prices BNTX at a forward multiple of 21.87. As a discount to projected earnings, BioNTech ranks better than 63.64% of its biotech peers.
As well, it trades at 1.27-times tangible book value, well below the sector median stat of 2.61. Beyond the valuation argument, BioNTech commands outstanding strengths in the balance sheet, particularly with a cash-to-debt ratio of 66.28. Therefore, it’s one of the holistic cheap stocks to consider.
Vir Biotechnology (VIR)
Headquartered in San Francisco, California, Vir Biotechnology (NASDAQ:VIR) has one core ethos: to help bring about a world without infectious diseases. According to its website, Vir focuses on combining immunologic insights with cutting-edge tech to treat and prevent serious infectious diseases. Since the Jan. opener, VIR gained nearly 2% of its equity value. In the past 365 days, it’s up 14%.
Although these are strong figures, VIR still makes a case for the best bargain stocks to buy. Currently, the market prices shares at a trailing multiple of 6.66. As a discount to earnings, Vir ranks better than 88.26% of the competition. Additionally, VIR trades at 1.67 times tangible book value. In contrast, the sector median stat comes in at 2.61 times. Finally, on the valuation front, VIR trades at a subterranean 2.08-times free cash flow.
On the balance sheet, Vir enjoys a strong cash-to-debt ratio of 18.77 times. Moreover, its three-year book growth rate pings at 58.2%, blowing past 89.21% of its rivals. Thus, it’s a worthy idea for undervalued stocks.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.