Value investing has created more billionaires than any other strategy, like Warren Buffett, who built his fortune by purchasing wonderful businesses at reasonable prices. But these hidden gems are few and far between - many stocks that appear cheap often stay that way because they face structural issues.
Separating the winners from the value traps is a tough challenge, and that’s where StockStory comes in. Our job is to find you high-quality companies that will stand the test of time. That said, here is one value stock trading at a big discount to its intrinsic value and two climbing an uphill battle.
Two Value Stocks to Sell:
D.R. Horton (DHI)
Forward P/E Ratio: 13.4x
One of the largest homebuilding companies in the U.S., D.R. Horton (NYSE:DHI) builds a variety of new construction homes across multiple markets.
Why Is DHI Not Exciting?
- Backlog has dropped by 15.5% on average over the past two years, suggesting it’s losing orders as competition picks up
- Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term
- Eroding returns on capital suggest its historical profit centers are aging
At $150.38 per share, D.R. Horton trades at 13.4x forward P/E. If you’re considering DHI for your portfolio, see our FREE research report to learn more.
Donnelley Financial Solutions (DFIN)
Forward P/E Ratio: 10.8x
Born from the need to navigate increasingly complex financial regulations in the digital age, Donnelley Financial Solutions (NYSE:DFIN) provides software and technology-enabled services that help companies comply with SEC regulations and manage financial transactions and reporting requirements.
Why Are We Hesitant About DFIN?
- Products and services are facing significant end-market challenges during this cycle as sales have declined by 3% annually over the last five years
Donnelley Financial Solutions is trading at $46 per share, or 10.8x forward P/E. Dive into our free research report to see why there are better opportunities than DFIN.
One Value Stock to Watch:
Concentrix (CNXC)
Forward P/E Ratio: 3.2x
With a team of approximately 450,000 employees across 75 countries, Concentrix (NASDAQ:CNXC) designs and delivers customer experience solutions that help global brands manage their customer interactions across digital channels and contact centers.
Why Do We Like CNXC?
- Annual revenue growth of 22.1% over the last two years was superb and indicates its market share increased during this cycle
- $9.72 billion in revenue allows it to spread its fixed costs across a wider base
- Respectable free cash flow margin of 5.6% minimizes the need for external capital because it can finance growth internally
Concentrix’s stock price of $38.11 implies a valuation ratio of 3.2x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free for active Edge members.
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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