The low valuation multiples for value stocks provide a margin of safety that growth stocks rarely offer.
However, the challenge lies in determining whether these cheap assets are genuinely undervalued or simply on sale due to their potentially deteriorating business models.
This distinction between true value and value traps can challenge even the most skilled investors. Luckily for you, we started StockStory to help you uncover exceptional companies. That said, here are two value stocks trading at big discounts to their intrinsic values and one best left ignored.
One Value Stock to Sell:
Alight (ALIT)
Forward P/E Ratio: 6.2x
Born from a corporate spinoff in 2017 to focus on employee experience technology, Alight (NYSE:ALIT) provides human capital management solutions that help companies administer employee benefits, payroll, and workforce management systems.
Why Is ALIT Risky?
- Annual sales declines of 2.5% for the past five years show its products and services struggled to connect with the market during this cycle
- Earnings per share have dipped by 6% annually over the past two years, which is concerning because stock prices follow EPS over the long term
- Shrinking returns on capital from an already weak position reveal that neither previous nor ongoing investments are yielding the desired results
At $3.94 per share, Alight trades at 6.2x forward P/E. If you’re considering ALIT for your portfolio, see our FREE research report to learn more.
Two Value Stocks to Watch:
Match Group (MTCH)
Forward EV/EBITDA Ratio: 7.5x
Originally started as a dial-up service before widespread internet adoption, Match (NASDAQ:MTCH) was an early innovator in online dating and today has a portfolio of apps including Tinder, Hinge, Archer, and OkCupid.
Why Does MTCH Stand Out?
- Customers are spending more money on its platform as its average revenue per user has increased by 8.9% annually over the last two years
- Healthy EBITDA margin of 36.3% shows it’s a well-run company with efficient processes
- Strong free cash flow margin of 26.4% enables it to reinvest or return capital consistently, and its improved cash conversion implies it’s becoming a less capital-intensive business
Match Group is trading at $37.37 per share, or 7.5x forward EV/EBITDA. Is now a good time to buy? Find out in our full research report, it’s free.
First Busey (BUSE)
Forward P/B Ratio: 1x
Tracing its roots back to 1868 during America's post-Civil War reconstruction era, First Busey (NASDAQ:BUSE) is a bank holding company that provides commercial and retail banking, wealth management, and payment technology solutions across Illinois, Missouri, Florida, and Indiana.
Why Are We Positive On BUSE?
- Impressive 12.9% annual net interest income growth over the last five years indicates it’s winning market share this cycle
- Projected net interest income growth of 50.7% for the next 12 months is above its five-year trend, pointing to accelerating demand
- Impressive 19% annual tangible book value per share growth over the last two years indicates it’s building equity value this cycle
First Busey’s stock price of $24.69 implies a valuation ratio of 1x forward P/B. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
High-Quality Stocks for All Market Conditions
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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