Morningstar Magazine - February/March 2014 - (Page 86)

By the Numbers: Stocks Undervalued Stocks With Wide Moats Undervalued stocks with significant competitive advantages can make attractive long-term holdings. With that in mind, we scoured our 2,000-plus stock coverage universe for high-quality stocks (those boasting wide economic moats) that are trading on the cheap (rated 4 or 5 stars by our analysts). Name it 4 or 5 stars. The wider the discount, the higher the star rating, and vice versa. There were 29 stocks that fit that profile as of Jan. 10, 2014, the same that made the list on Oct. 31, 2013. When a stock trades at a suitably wide discount to our estimate, we award Industry Baxter International Inc. BAX Berkshire Hathaway Inc Class A BRK.A Boardwalk Pipeline Partners LP BWP CH Robinson Worldwide, Inc. CHRW Clorox Company CLX Our analysts award wide economic moats to companies that they believe possess durable competitive advantages that are likely to provide economic profits well into the future. Market Cap ($Mil) EPS TTM P/E Ratio (trailing) Revenue Growth % 3 Yr Medical Instruments & Supplies Insurance - Diversified Oil & Gas Midstream Integrated Shipping & Logistics Household & Personal Products 38,103 282,982 6,083 8,575 11,502 3.95 11,570.72 1.38 3.63 4.32 17.61 15.06 18.48 16.08 21.37 4.15 13.03 9.23 14.45 2.42 5.20 20.02 17.42 19.88 0.47 Coca-Cola Co KO eBay Inc EBAY El Paso Pipeline Partners LP EPB Enbridge, Inc. ENB Enterprise Products Partners LP EPD Beverages - Soft Drinks Specialty Retail Oil & Gas Midstream Oil & Gas Midstream Oil & Gas Midstream 175,445 67,410 7,713 35,996 59,805 1.93 2.10 2.00 1.07 2.75 21.41 26.18 18.05 43.29 24.10 15.72 17.26 10.62 26.62 18.62 10.38 2.83 408.00 -28.40 39.89 2.82 - 7.09 2.83 4.22 26.75 12.91 21.88 11.51 18.33 Exelon Corp EXC Express Scripts ESRX Kinder Morgan Management LLC KMR Kinder Morgan, Inc. KMI Magellan Midstream Partners, L.P. MMP Utilities - Diversified Health Care Plans Oil & Gas Midstream Oil & Gas Midstream Oil & Gas Midstream 23,162 58,324 9,375 37,197 13,719 1.86 2.23 1.90 0.72 2.41 14.53 30.21 39.84 50.25 26.32 10.69 56.00 0.00 11.55 20.45 -29.72 4.10 - - 20.04 5.38 - - 4.34 3.47 7.34 7.95 6.41 7.84 35.99 McDonald's Corporation MCD Novo Nordisk A/S ADR NVO ONEOK Partners, L.P. OKS PepsiCo Inc PEP Procter & Gamble Co PG Restaurants Biotechnology Oil & Gas Midstream Beverages - Soft Drinks Household & Personal Products 94,986 20,272 11,717 127,059 218,600 5.54 9.18 2.34 4.26 3.94 17.51 21.83 22.52 19.46 20.70 6.62 15.17 16.29 14.85 2.16 9.25 29.67 19.09 1.31 -2.07 3.27 1.18 5.67 2.70 2.94 38.45 66.55 10.97 30.29 17.72 Sanofi ADR SNY Spectra Energy Corp SE Spectra Energy Partners, LP SEP Sysco Corporation SYY Unilever PLC ADR UL Drug Manufacturers - Major Oil & Gas Midstream Oil & Gas Midstream Food Distribution Household & Personal Products 135,394 23,291 4,949 20,896 119,483 1.17 1.52 1.75 1.67 1.64 33.22 23.42 18.55 21.60 18.25 5.35 3.69 9.80 6.04 8.83 -2.46 2.70 -0.39 -5.68 9.59 2.57 3.51 4.73 3.15 3.53 - 11.58 9.60 19.65 35.28 Weight Watchers International, Inc. WTW Western Union Company WU Westpac Banking Corp ADR WBK Williams Partners LP WPZ Personal Services Credit Services Banks - Global Oil & Gas Midstream 1,836 9,421 88,857 21,475 4.12 1.52 2.16 1.76 7.99 11.36 15.58 28.82 9.30 3.67 3.30 16.73 22.52 11.78 1.33 -13.10 2.15 2.93 5.79 6.98 - 78.55 15.00 7.53 86 Morningstar February/March 2014 EPS Dividend Yield Growth % % Current 3 Yr ROE % (trailing) 2.73 29.31 - 9.69 8.52 8.40 2.48 50.83 3.03 1,885.25

Table of Contents for the Digital Edition of Morningstar Magazine - February/March 2014

Morningstar Magazine - February/March 2014
Contents
Contributors
Letter From the Editor
Preparing for the Next 50 Years
Morningstar Managers of the Year
Fixing the Trust Deficit
Rethinking the Path to Retirement
Trends
Same Old, Same Old
Global Briefs
The Economic Implications of an Older World
Banking on Performance
Is the Affordable Care Act Healing Health Care’s Woes?70
Baxter Has a Positive Prognosis
Leading Fidelity’s Charge for RIAs
Our Favorite Mutual Funds
50 Most-Popular Equity ETFs
Undervalued Stocks With Wide Moats
Moving the Goal Post

Morningstar Magazine - February/March 2014