September — widely regarded as the “worst month for the stock market” — is living up to its reputation. In fact, the S&P 500 is down 1% since August, in line with its average 1.1% monthly decline since 1928. Of course, many investors are spooked, unsure of how to invest in an economy on shaky ground. All while other investors seek out some of the most undervalued safe stocks on the market, including the seven below.
Amplify Energy (AMPY)
Amplify Energy (NYSE:AMPY) kicked off September with a bang, climbing 15%. However, there’s still room to run for this oil and gas company. For one, its free cash flow is sufficient and steady, hovering at or above $40 million for the past three years. Two, not only does Amplify have plenty of cash on hand to grow or return value to shareholders but it has also trimmed down debt substantially. That alone is notable, especially when most oil and gas firms remain debt-heavy. For example, the industry’s average debt-to-equity ratio is usually around 0.5, but Amplify’s is below 0.40.
Finally, Amplify’s valuation ratios indicate the company remains undervalued despite its September surge. Its price-to-earnings ratio (P/E) is only 0.70. But, most appealing to value investors, Amplify’s price-to-book ratio is well below 1.00 – meaning its share price doesn’t match its net asset value.
SharkNinja (NYSE:SN) snuck onto the stock market in July and is just beginning to capture investor attention. The consumer discretionary stock produces and sells a range of home and personal appliances like ice cream makers, blenders, and hair dryers. Most notably, its recent performance in a down economy is particularly impressive. Sales have risen 20% annually since 2008, and management expects to end the year with $4 billion in revenue.
This week, SharkNinja got its first Wall Street analyst rating from investment banking firm Jefferies. Analysts at the firm rated SharkNinja a Buy and assigned a $67 per-share target to the stock. That’s still 60% above today’s pricing, despite recent stock gains, meaning there’s still upside for latecomers.
Berry Global Group (BERY)
Plastic packaging might not be the most exciting stock prospect, but it’s the reason Berry Global Group (NYSE:BERY) is a safe, undervalued stock. The company produces plastic packaging across consumer, engineering, healthcare, and hygiene sectors. If you take prescription medication, chances are high that Berry produced the bottle.
Berry is also forward-thinking for those concerned about environmental sustainability, generating innovation in carbon reduction and waste management spaces. That commitment to a sustainable future is evidenced by Berry’s “A” rating on environmental initiatives, including a “commitment to reducing the environmental impact of packaging and achieving net-zero emissions by 2050.”
Berry’s in-demand, pervasive products ensure its stickiness in global markets, while its sustainable innovations ensure the company can adapt to changing expectations and remain viable long-term. The company trades at a 0.57 price-to-sales ratio and an equally low 11.82 price-to-earnings ratio.
Tax time is approaching, making Intuit (NASDAQ:INTU) a decidedly safe stock — especially with more than 80% of Americans filing taxes digitally. Intuit Inc. is a prominent software company specializing in financial software, notably tax and accounting products, including its well-known product, TurboTax. In addition to broad-based tax solutions, the company stands to benefit from the swelling number of gig workers and side hustlers. That market is exploding, expected to hit $455 billion by 2030, and Intuit’s tax solutions uniquely target this demographic.
In its latest earnings report, Intuit reported a net income of $89 million, or 32 cents per share, compared to the net loss of $56 million, or 20 cents per share, in the same period the previous year. Adjusted earnings per share stood at $1.66. The company’s revenue surged by 12% to $2.71 billion from $2.4 billion year-over-year. Despite strong recent performance and relatively high per-share pricing, analysts affirm its Buy rating and indicate the stock remains undervalued.
SK Telecom (SKM)
Telecom stocks tend to be the safest around but usually trade close to fair value. Telecom stocks rarely swell to overblown pricing but, at the same time, don’t often dip into undervalued territory. SK Telecom (NYSE:SKM) is an exception.
SKM is a South Korean telecom company, the largest in the country. Still, it continues innovating in the face of significant market saturation. The company services just under 50% of the South Korean wireless market. But SKM is also pouring cash into artificial intelligence initiatives, investing $100 million into a Google-backed (NASDAQ:GOOG, NASDAQ:GOOGL) multilingual language model startup.
SKM’s drive towards innovation makes the company undervalued based on long-term prospects, but it’s also materially undervalued today. The stock trades at a 0.92 price-to-book ratio and a 10.14 price-to-earnings ratio. The wireless telecom industry’s average price-to-earnings ratio is more than 3x SKM’s, at 30.25 – making this safe stock decidedly undervalued.
Advanced Micro Devices (AMD)
Advanced Micro Devices (NASDAQ:AMD) may not seem overvalued on its own, but it certainly is compared to the broad artificial intelligence sector, considering its long-term potential.
In its second-quarter 2023 earnings report, AMD reported non-GAAP earnings of 58 cents per share, exceeding analysts’ expectations. Revenues for the quarter amounted to $5.36 billion. That beat by a slim 0.67%, but AMD’s future remains bright. Management has an optimistic outlook for the third quarter of 2023. In the report, AMD expects revenues to reach $5.7 billion. That’s a 2.5% year-over-year growth and a 6.5% sequential increase. Consistent, small gains indicate stability, which is critical in an emerging market like AI.
AMD’s strategic acquisitions, such as the purchase of French AI Software Company Mipsology, demonstrate its commitment to enhancing its capabilities in artificial intelligence. The company has been actively focusing on AI, including introducing a new GPU for artificial intelligence in June.
Danaher Corporation (DHR)
Danaher Corporation (NYSE:DHR) specializes in manufacturing scientific instruments and consumables, operating across three segments: life sciences, diagnostics, and environmental and applied solutions. Although the stock remained relatively flat year-to-date, underperforming the market, recent financials suggest hidden upside potential and undervalued status.
In its most recent earnings report, Danaher exceeded analysts’ expectations by reporting quarterly earnings of $2.05 per share. That’s a tad lower than last year’s period, which is understandable given today’s economic state. However, Danaher beat the estimated $2 per share and posted $7.16 billion in revenue. The beat suggests the company can adapt to shifting economic winds.
August brought a significant development as Danaher announced its plan to acquire Abcam plc (NASDAQ:ABCM), a leading global supplier of protein consumables. The move will streamline Danaher’s life sciences division, improving operational efficiency over time and increasing the company’s margins.
The stock also offers a modest 0.45% dividend yield. Although the yield isn’t groundbreaking, it further reinforces the company’s financial position and commitment to shareholders.
On the date of publication, Jeremy Flint held no positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.