Seeking Solace in Bargains Amidst a Soaring Market

As the market rallies relentlessly, and valuations in the leading stocks swell beyond reason, the allure of companies with discounted valuations becomes a beacon of comfort. Investing in stocks trading below historical valuations not only provides reassurance but also a counterbalance amid the frothy market sentiments.

Finding stocks with robust business models, impeccable Zacks Ranks, and robust earnings growth predictions can be a boon for investors seeking stability in uncertain times.

Perion Networks: Riding the Waves of Growth

The spotlight falls on Perion Networks, a global advertising technology (adtech) platform that acts as a bridge between advertisers, publishers, and consumers. Known for its prowess in facilitating targeted advertising through a spectrum of channels, including display, video, and search advertising, Perion Networks recently shot to fame for its strides in the connected TV (CTV) advertising sphere, a rapidly evolving segment within adtech.

Perion Networks has ascended to the coveted Zacks Rank #1 (Strong Buy) echelon following analysts’ upward revision of this year’s earnings estimates. Forecasts anticipate a 17% year-on-year sales growth for the current year and a further 10% surge in the next year.

Honda Motor Company: Revving Up for Value

Amidst the EV frenzy that has gripped the markets in recent years, traditional auto manufacturer stocks like Honda Motor Company have found themselves somewhat relegated. However, for astute investors, this downturn presents a tantalizing opportunity.

With EV sales growth tapering in the US and a resurgence in popularity of hybrid car alternatives, Honda Motor Company finds itself in a favorable position. Outperforming the likes of Tesla over the past nine months, Honda Motor Company now flaunts a Zacks Rank #1 (Strong Buy) rating, indicative of a bullish trend in earnings revisions. Projections paint a picture of a 14% expansion in sales for the current year.

KKR & Co.: The Unstoppable Force in Private Equity

Enter private equity behemoth KKR & Co., a titan that has commanded the markets over the past four months, outstripping the already commendable returns of the broader market. Fueled by its burgeoning private credit arm, KKR & Co. has witnessed an unprecedented surge owing to the reluctance of banks to extend loans, drawing in a plethora of investors seeking refuge.

Carrying a Zacks Rank #1 (Strong Buy) badge, KKR & Co. basks in the glow of nearly unanimous revisions of earnings estimates upwards by the analyst community. A robust 18% rise in topline growth this year coupled with a 15% expansion in the following year cements its status as a powerhouse in the market.

A Steady Ship Amidst Market Volatility

Analyzing KKR & Co.’s Financial Performance

KKR & Co. Inc. has been holding its ground amidst market fluctuations, with an earnings multiple of 21.2x, slightly above its historical average of 14.4x over the last decade. Despite not trading at a historical discount, the company’s business is thriving, showcasing impressive growth and profitability trends that investors find comforting. KKR’s PEG ratio of 0.78 speaks volumes about its exceptional financial health.

The Promise of Growth Ahead

With an estimated 27.2% annual growth in earnings per share (EPS) forecasted over the next 3-5 years, KKR is showing no signs of slowing down. This anticipated growth trajectory is a significant factor contributing to the favorable PEG ratio, making KKR an attractive choice for investors seeking growth opportunities.

Image Source: Zacks Investment Research

Consideration for Investors

For investors who prioritize value over rapid growth, KKR & Co. Inc., along with two other stocks, present themselves as strong candidates for inclusion in their portfolios. These stocks offer the potential for consistent returns and long-term appreciation, providing a sense of stability in an ever-shifting market landscape.