The S&P 500 (SPX) index has witnessed an impressive year-to-date rally of about 27%. This bullish market momentum reflects a favorable opportunity for investors to consider undervalued stocks. That is because these stocks trade at a lower price relative to their fundamentals, such as dividends, earnings, or sales, which makes them appealing to investors seeking stocks with the potential for long-term gains. Today, we have focused on Dell Technologies (DELL), First Solar (FSLR), Delta Airlines (DAL), Rio Tinto (RIO), and Elevance Health (ELV).
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Using the TipRanks stock screener tool, we zeroed in on these stocks as they have a Strong Buy consensus rating, and their price targets reflect an upside potential of more than 20%. Furthermore, these stocks seem to be undervalued, as they are currently trading at a discount from their respective sector averages.
Let’s take a closer look at these stocks.
- Dell Technologies – Dell is a multinational company provides personal computers and enterprise solutions. DELL stock is trading at 21 times earnings, which reflects a discount of 30.15% from the technology sector’s median of 30.07x. The average DELL price target is $149.72, implying a solid upside potential of 25.9% from current levels.
- First Solar – FSLR manufactures thin-film solar panels and development of solar power projects. FSLR shares trade at 16.1x earnings, which is below the tech sector median of 30.07x. Further, analysts’ average FSLR stock price target of $271.71 implies a 45.92% upside potential from current levels.
- Delta Air Lines – DAL offers global airline offering passenger and cargo services. It currently has a P/E ratio of 8.5x, which is down 63.85% from the industrial goods sector median of 23.63x. The average DAL stock price target is $77.58, implying a 24.01% upside potential.
- Rio Tinto – Rio Tinto is a multinational mining company, and producer of iron ore, aluminum, copper, and other metals. RIO stock trades at 8.9 times trailing earnings, reflecting a 53.94% discount from the basic materials sector median. The average price target of $85.94 points to a 45.17% potential upside in the next 12 months.
- Elevance Health – This health benefits company provides personalized healthcare solutions. The stock is trading at 13.5 times earnings, 54.26% lower than the healthcare sector median. The average ELV stock price target of $504.54 implies a 35.29% upside potential.
Ending Note
All five above-mentioned stocks present a potential opportunity for value-focused investors in 2025. However, investors must conduct proper research on these stocks before making an investment decision.
