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15 Market-Beating Stocks That Are Still Undervalued: Morningstar

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In two blog posts this month, Susan Dziubinski, director of content for Morningstar.com, wrote about stocks with wide and narrow economic moat ratings that the firm’s analysts considered undervalued. 

Companies in both categories “boast long-term structural advantages over their competitors, and those advantages allow them to successfully fend off competition,” Dziubinski wrote.

Morningstar assigns wide economic ratings to companies it thinks can keep competitors at bay for 20 years or more. Those the firm thinks can do so for a decade or more earn narrow economic moat ratings.

During the week of June 1, analysts screened for wide-moat stocks that had returned more than twice as much as the overall market in 2021 — 11%, based on the Morningstar US Market Index.

The following week, analysts screened for narrow-moat stocks that had returned more than twice as much as the overall market nearly 12%.

In both instances, analysts winnowed down the list to those names trading at 4- or 5-star levels.

From these lists, we’ve taken the top 15 stocks by year-to-date return and presented them in the gallery above.

— Check out Inflation? Bring It On, Says Stock-Picking Whiz on ThinkAdvisor.