Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 7 stocks made the list for top value stocks in the Investment Management & Fund Operators industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Investment Management & Fund Operators Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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7 Undervalued Investment Management & Fund Operators Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 7 undervalued stocks in the Investment Management & Fund Operators industry for Wednesday, August 14, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Investment Management & Fund Operators industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Bank of New York Mellon Corp’s Value Grade

Value Grade:

The Bank of New York Mellon Corporation is a global company. The Company’s businesses are divided into three business segments: Securities Services, Market and Wealth Services and Investment and Wealth Management. The Company also includes Other segment, which includes the leasing portfolio, corporate treasury activities, including its securities portfolio, derivatives and other trading activities, corporate and bank-owned life insurance, renewable energy and other corporate investments. The Company’s two principal United States banking subsidiaries include The Bank of New York Mellon, a New York state-chartered bank, which houses its Securities Services businesses, including asset servicing and issuer services and certain market and Wealth Services businesses, including treasury services and clearance and collateral management, as well as the bank-advised business of investment management and BNY Mellon, National Association, which houses its wealth management business.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Bank of New York Mellon Corp has a Value Score of 71, which is considered to be undervalued.

When you look at Bank of New York Mellon Corp’s price-to-sales ratio at 1.98 compared to the industry median at 3.57, this company has a lower price relative to revenue compared to its peers. This could make Bank of New York Mellon Corp’s stock more attractive for value investors.

Bank of New York Mellon Corp’s price-earnings ratio is 15.12 compared to the industry median at 13.87. This means it has a higher share price relative to earnings compared to its peers. This could make Bank of New York Mellon Corp less attractive for value investors.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Bank of New York Mellon Corp’s shareholder yield is higher than its industry median ratio of 2.93%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Bank of New York Mellon Corp’s price-to-book ratio is higher than its industry median ratio of 1.06. This could make Bank of New York Mellon Corp less attractive to investors looking for a new addition to their portfolio.

Elron Ventures Ltd (USA)’s Value Grade

Value Grade:

Elron Electronic Industries Ltd. is an operational holding company that focuses on building and enhancing technology companies, mainly in the field of medical devices. Its group companies include companies at different stages of development and business maturation, operating in various technology fields, such as medical device and other fields. It is involved in the management of its group companies by means of membership and providing assistance to management. It operates in the Holdings and Corporate Operations segment. It is engaged in matters of policy guidance, strategic planning, marketing, selecting and manning senior management positions, determining the business plan, approving investments and budgets, development and operational guidance, assistance in creating strategic partnerships, and the overall ongoing monitoring of its group companies' performance. Its main group companies include BrainsGate Ltd, Pocared Diagnostics Ltd. and RDC Rafael Development Corporation Ltd.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Elron Ventures Ltd (USA) has a Value Score of 75, which is considered to be undervalued.

Elron Ventures Ltd (USA)’s price-to-book ratio is higher than its peers. This could make Elron Ventures Ltd (USA) less attractive for value investors when compared to the industry median at 1.06.

You can read more about Elron Ventures Ltd (USA)’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Federated Hermes Inc’s Value Grade

Value Grade:

Federated Hermes, Inc. is an investment management company. The Company operates through a single segment, being the investment management business. It sponsors, markets and provides investment-related services to various investment products, including sponsored investment companies and other funds (Federated Hermes Funds); and Separate Accounts, which include separately managed accounts (SMAs), institutional accounts, sub-advised funds and other managed products in both domestic and international markets. In addition, it markets and provides stewardship and real estate development services to various domestic and international companies. The Company provides investment advisory services to approximately 180 Federated Hermes Funds. It markets these funds to institutional customers and banks, broker/dealers and other financial intermediaries who use them to meet the needs of customers and/or clients, including, among others, retail investors, corporations and retirement plans.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Federated Hermes Inc has a Value Score of 70, which is considered to be undervalued.

Federated Hermes Inc’s price-earnings ratio is 11.1 compared to the industry median at 13.9. This means that it has a lower price relative to its earnings compared to its peers. This makes Federated Hermes Inc more attractive for value investors.

Federated Hermes Inc’s price-to-book ratio is lower than its peers. This could make Federated Hermes Inc more attractive for value investors when compared to the industry median at 1.06.

You can read more about Federated Hermes Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

9F Inc - ADR’s Value Grade

Value Grade:

9F Inc is a China-based company mainly engaged in the provision of financial investment services through digital financial account platform. The Company's products and services mainly include loan products, online wealth management products, and payment facilitation. The Company provides services, including quota installment, shopping mall installment, credit card management and other services through a smart credit account product One Card (GRAPHIC). The Company also operate a online shopping platform, One Card Mall.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

9F Inc - ADR has a Value Score of 84, which is considered to be undervalued.

9F Inc - ADR’s price-to-book ratio is higher than its peers. This could make 9F Inc - ADR less attractive for value investors when compared to the industry median at 1.06.

You can read more about 9F Inc - ADR’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Blue Owl Capital Corp’s Value Grade

Value Grade:

Blue Owl Capital Corporation is a specialty finance company focused on lending to United States middle-market companies. The Company’s investment objective is to generate current income and, to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns. The Company invest in senior secured or unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, equity and equity-related securities, including common and preferred stock, securities convertible into common stock, and warrants. Its portfolio by industry includes Internet software and services, insurance, food and beverage, asset-based lending and fund finance, healthcare providers and services, healthcare technology, buildings and real estate, consumer products, manufacturing, aerospace and defense, distribution, household products, business services, and others. The Company is externally managed by Blue Owl Credit Advisors LLC.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Blue Owl Capital Corp has a Value Score of 67, which is considered to be undervalued.

Blue Owl Capital Corp’s price-earnings ratio is 8.0 compared to the industry median at 13.9. This means that it has a lower price relative to its earnings compared to its peers. This makes Blue Owl Capital Corp more attractive for value investors.

Blue Owl Capital Corp’s price-to-book ratio is higher than its peers. This could make Blue Owl Capital Corp less attractive for value investors when compared to the industry median at 1.06.

You can read more about Blue Owl Capital Corp’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Principal Financial Group Inc’s Value Grade

Value Grade:

Principal Financial Group, Inc. is a global financial company. The Company offers businesses, individuals and institutional clients a range of financial products and services, including retirement, asset management and insurance through its diverse family of financial services companies. The Company's segments include retirement and income solutions, principal asset management, and benefits and protection. The Retirement and Income Solutions segment offers workplace savings and retirement solutions, banking, trust and custodial services, individual variable annuities, and pension risk transfer, among others. The Principal Asset Management segment provides global investment solutions to institutional, retirement, retail and high net worth investors. The Benefits and Protection segment is organized into Specialty Benefits, which provides group dental, group life insurance, group disability insurance, supplemental health products, and individual disability insurance, and life insurance.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Principal Financial Group Inc has a Value Score of 78, which is considered to be undervalued.

Principal Financial Group Inc’s price-earnings ratio is 14.6 compared to the industry median at 13.9. This means that it has a higher price relative to its earnings compared to its peers. This makes Principal Financial Group Inc less attractive for value investors.

Principal Financial Group Inc’s price-to-book ratio is lower than its peers. This could make Principal Financial Group Inc more attractive for value investors when compared to the industry median at 1.06.

You can read more about Principal Financial Group Inc’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Rand Capital Corp’s Value Grade

Value Grade:

Rand Capital Corporation is an externally managed business development company (BDC). The Company’s investment objective is to maximize total return to its shareholders with current income and capital appreciation by focusing its debt and related equity investments in privately held, lower middle market companies with committed and experienced managements in a variety of industries. The Company invests in businesses that have sustainable, differentiated and market proven products. The Company invest at least 70 % of total assets in qualifying assets and provide managerial assistance to the portfolio companies in which it invests. The Company's portfolio includes professional and business services, manufacturing, consumer product, software, distribution, automotive, and oil and gas. The Company's investment adviser is Rand Capital Management, LLC (RCM).

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Rand Capital Corp has a Value Score of 65, which is considered to be undervalued.

Rand Capital Corp’s price-earnings ratio is 8.0 compared to the industry median at 13.9. This means that it has a lower price relative to its earnings compared to its peers. This makes Rand Capital Corp more attractive for value investors.

Rand Capital Corp’s price-to-book ratio is higher than its peers. This could make Rand Capital Corp less attractive for value investors when compared to the industry median at 1.06.

You can read more about Rand Capital Corp’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Investment Management & Fund Operators Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Investment Management & Fund Operators stocks as well as other industrys.

Choosing Which of the 7 Best Investment Management & Fund Operators Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Bank of New York Mellon Corp stock has a Value Grade of B.
• Elron Ventures Ltd (USA) stock has a Value Grade of B.
• Federated Hermes Inc stock has a Value Grade of B.
• 9F Inc - ADR stock has a Value Grade of A.
• Blue Owl Capital Corp stock has a Value Grade of B.
• Principal Financial Group Inc stock has a Value Grade of B.
• Rand Capital Corp stock has a Value Grade of B.

Now that you have a bit more background about each of the 7 undervalued stocks in the Investment Management & Fund Operators industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Investment Management & Fund Operators Stocks

Want to learn more about Investment Management & Fund Operators stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 7 Undervalued Investment Management & Fund Operators Stocks for Wednesday, August 14
• Is Nuveen Virginia Quality Mncpl Incm Fund (NPV) a Good Dividend Stock?
• Is Nuveen Virginia Quality Mncpl Incm Fund (NPV) Stock a Good Investment?
• 5 Undervalued Investment Management & Fund Operators Stocks for Tuesday, August 13

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