Value Screeners Identify Opportunities for 4th Quarter

As investors monitor the U.S. market decline, GuruFocus’ value screeners continue to identify opportunities based on strategies from value investing legends like Benjamin Graham, Peter Lynch and Berkshire Hathaway Inc. (

BRK.A, Financial)(BRK.B, Financial) CEO
Warren Buffett (Trades, Portfolio).

Tech shares weigh on markets to start first week of October

The Dow Jones Industrial Average closed at 34,002.92, down 323.54 from Friday’s close of 34,326.46. Likewise, the Nasdaq Composite Index closed at 14,255.48, down 311.21 points or approximately 2.14% from the previous close of 14,566.70 on the back of technology stocks like Apple Inc. (

AAPL, Financial), Facebook Inc. (FB, Financial) and Microsoft Corp. (MSFT, Financial) tumbling more than 2%.

Investors continued rotating out of technology stocks while monitoring movements in long-term Treasury yields: On Monday, the 10-year Treasury yield stood at around 1.48% while the 30-year Treasury yield stood at around 2.04%.

GuruFocus’ value strategies still outperform the benchmark year to date

Table 1 reports the cumulative returns since inception and the one-year annualized returns for several major value strategies, including the Undervalued-Predictable, Buffett-Munger, Historical Low Price-Book and Historical Low Price-Sales strategies.

Table 1

Among the above strategies, the Undervalued-Predictable strategy had the highest cumulative return since inception and the highest one-year annualized return. The strategy looks for stocks that have strong and consistent revenue and earnings and are trading below intrinsic value based on discounted free cash flow and discounted earnings.

Table 2 reports the number of Undervalued-Predictable stocks for each GuruFocus region.

Table 2

The Buffett-Munger Screener follows the Berkshire co-manager’s four-criterion investing approach: high business predictability, strong gross margins, low debt-to-revenue growth and low price-earnings-to-growth valuations.

Likewise, the Historical Low Price-Book and Historical Low Price-Sales Screeners looks for predictable companies that are trading at historical low price-book or historical low price-sales ratios.

Table 3 lists the number of stocks making the other major GuruFocus value screens.

Table 3