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4 Value Stocks to Buy in May

Published 05/10/2021, 01:40 PM
Updated 05/10/2021, 02:30 PM
© Reuters.  4 Value Stocks to Buy in May

After a dull 2020, value stocks are back in action. Amid the economy’s reopening, many fundamentally sound stocks that lost significant value last year have started rebounding. Furthermore, we think inflationary pressure in the United States and concerns over the market’s overvaluation call for investing in reasonably priced stocks. Hologic (NASDAQ:HOLX), AGCO Corporation (AGCO), Bausch Health Companies (NYSE:BHC), and United Therapeutics (NASDAQ:UTHR) are four names that are currently trading at reasonable valuations considering their fundamental strength and growth potential. So, they cry out for a closer look.2020 was largely dominated by growth stocks, with the tech sector at the forefront. However, with a mass inoculation drive and fiscal and monetary policy support, the economic landscape looks encouraging in the United States. This environment has motivated investors to rotate away from expensive growth stocks to quality value stocks.

As a result, value stocks are back in the limelight after underperforming the broader market last year. This is evidenced by the SPDR Portfolio S&P 500 Value ETF’s (SPYV) 14.2% returns over the past three months versus the SPDR Portfolio S&P 500 Growth ETF’s (SPYG) 4.1% gains. While the economy has begun to recover in the United States, the health crisis is far from over and there is still a sense of uncertainty in the markets. Experts also worry that another stock market correction could be in the offing. Therefore, picking fundamentally strong undervalued stocks could be a smart strategy at this juncture.

We believe Hologic, Inc. (HOLX), AGCO Corporation (AGCO), Bausch Health Companies Inc. (BHC), and United Therapeutics Corporation (UTHR) are solid value bets now.

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