10 undervalued stocks

Source: Barron's article: Bear Beaters - January 26 2008

Barron's discussed 10 undervalued stocks that look like a good bargain today. They are:
Name Ticker Price P/E
1. Altria MO 73.95 14.80
2. Boeing BA 77.03 14.80
3. CBS CBS 23.88 13.76
4. Chubb CB 48.27 7.01
5. Conoco COP 74.13 11.49
6. Cummins CMI 49.02 13.49
7. Disney DIS 28.68 12.75
8. Freeport McMoran FCX 84.22 10.01
9. General Electric GE 34.00 15.65
10. Motorola MOT 10.73 43.5

1. Altria (MO)
There are talks about breakup between the international and domestic cigarette divisions that is expected in the spring. The stock trades for $73.95 as of Friday, January 25. By breaking up the company, they could unleash the values that stem from better operational management, cost reductions, a clean balance sheet, and big buybacks.
2. Boeing (BA)
Announced that the 787 Dreamliner is delayed, but they have lots of orders, and with the increased competition in the airline industry, and the long term outlook on the expanding economy, it is well positioned for good growth.
3. CBS (CBS)
Trades for just 13 times earnings, and it's down big time from a summer high of 35. Good dividend of $1 will likely increase as Sumner Redstone, the legendary chairman will seek ways to return some value to the investors.
4. Chubb (CB)
Multiyear low valuation, it trades at a 7 times multiple. Profitable business, with a great insurance brand, Chubb generates 16% ROE, and it had no meaningful exposure to the subprime mortgage mess.
5. ConocoPhillips (COP)
Solid financial and operating results. There is a buyback program in progress, but they may also increase dividends as well; now the dividend yield is 2.2%.
6. Cummins (CMI)
The maker of Diesel engines is taking Caterpillar for a ride, as is increasing market share for the heavy and medium-duty trucks. It should benefit from the upcoming explosion of global diesel-emissions regulations.
7. Disney (DIS)
Valuation is at 10-yr low for this stock, despite rising profits. 2008 estimated EPS is $2.13 per share. The dividend is low, just 1.2% and they could pay more, but they prefer buybacks, having just bought 10% of its shares in the fiscal year ended September.
8. Freeport McMoran (FCX)
The world largest copper producer has seen its shares off about 17% in January alone, but copper may be the best positioned among base metals. FCX has a lot going for it, such as high margins, low multiples, and it may be a good takeover potential at a market cap of $32B.
9. General Electric (GE)
Why GE doesn't get some love from Wall Street, I don't know. This company's products are number 1 in many industries, such as aircraft engines, power and health care. The dividend yield is 3.60%, just like the 10-yr Treasury bond, but with more upside from the long term capital gain.
10. Motorola (MOT)
I don't particularly like Motorola, but I must admit that at these levels it starts looking attractive. It is still profitable and has about $2 per share in cash. Something is going to happen at Motorola this year: maybe a breakup, sale of the non-performing divisions, Carl Icahn may strike again, but I see limited downside to the stock at this time.

Barron's is bullish on all these stocks and they see a price appreciation of at least 20% for each one of them.

Good luck and Happy Investing !