With the year 2021 coming to a close, investors are sifting through markets to identify the top undervalued stocks for 2022. Here is a list of exciting picks that could be substantially undervalued.
Pfizer
Pfizer Inc. (NYSE:PFE) shares have gained significantly over the last three months amid rising cases of Covid-19. The latest variant of the coronavirus, Omicron has increased the need for Pfizer vaccine booster shots. In addition, the company announced its own antiviral covid drug, to compete with Merck’s (NYSE:MRK) Molnupiravir.
From a valuation perspective, Pfizer shares trade at an attractive P/E ratio of 17.57 and a forward P/E ratio of 9.98. Analysts also expect its EPS to grow by nearly 19% per year over the next five years.
Source – TradingView
Technically, Pfizer shares seem to be trading within an ascending channel formation in the intraday chart. As a result, the stock has rallied closer to the overbought conditions of the 14-day RSI.
However, given its compelling valuation, investors could target profits deep into overbought conditions at about $61.70, or higher at $64.38, while $56.09 and $53.41 are crucial support levels.
Micron Technology
Micron Technology Inc. (NASDAQ:MU) is another stock on the uptrend. The stock has gained more than 42% since October. However, Micron still trades at an attractive P/E ratio of 14.60 and a forward P/E of 8.26, making it a compelling option for value investors.
In addition, analysts expect its EPS to grow by more than 28% per year over the next five years. Therefore, Micron could be substantially undervalued going into 2022.
Source – TradingView
Technically, Micron shares trade within an ascending channel formation in the intraday chart. As a result, the stock has spiked into overbought conditions, creating an opportunity for a pullback.
However, given its valuation and growth prospects, there is more room left to run. Therefore investors could target profits at about $97.61, or higher at $101.06, while $90.71 and $87.13 are support levels.
General Motors
General Motors co. (NYSE:GM) shares have pulled back more than 10% since November, pushing its P/E ratio to a low of 7.68 compared to its 5-year average of 12.70. Therefore, the stock could be an attractive option for value investors.
Moreover, analysts expect its bottom line to grow at an average annual rate of 15.20% over the next five years.
Source – TradingView
Technically, the stock seems to have recently bounced off the trendline support to surge towards the resistance trendline.
Therefore, investors could target channel breakout profits at about $60.48, or higher at $64.14, while $54.06 and $50.56 are crucial support levels.
HP Inc.
HP Inc. (NYSE:HPQ) shares are up nearly 44% since the 13th of October. However, the stock still trades at an attractive P/E ratio of 7.15, which is substantially below its 5-year average of 10.03.
In addition, analysts expect its EPS to grow at an average annual rate of 17.29% over the next five years.
Source – TradingView
Technically, the stock seems to have surged to trade closer to the overbought conditions of the 14-day RSI.
Therefore, investors could target channel breakout profits at about $40.16, or higher at $42.02, while $36.31 and $34.41 are crucial support zones.
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