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AEG, ORI, SFD, PDFS, BPT, AVT, Insurance Stocks Undervalued

^{Published on 2011-04-27 06:11:03 - WOPRAI}
 

April 27, 2011/ M2 PRESSWIRE / BUYINS.NET / http://www.squeezetrigger.com is monitoring the Insurance sector and these stocks are the most undervalued as of today. AEGON N.V.-NY REG SHR (NYSE:AEG), OLD REPUBLIC INTL CORP (NYSE:ORI), SMITHFIELD FOODS INC (NYSE:SFD), PDF SOLUTIONS INC (NASDAQ:PDFS), BP PRUDHOE BAY ROYALTY TRUST (NYSE:BPT), AVNET INC (NYSE:AVT) are all expected to go Up as they are Undervalued according to industry standard valuation metrics. The valuation model employs a three-factor approach to stock valuation using fundamental variables--the company's trailing 12-month Earnings-Per-Share (EPS), the analyst consensus estimate of the company's forecasted 12-month EPS, and the 30-year Treasury yield--to create a highly accurate reflection of a company's fair value.

The chart below displays the projected Fair Value and Valuation discount/premium of the most undervalued stocks in the highlighted industry group:

     Symbol     Company Name                        Last Close     Fair Value     Valuation                   Industry               
     AEG        AEGON N.V.-NY REG SHR               $7.89          $11.20         29.60% Undervalued          Insurance              
     ORI        OLD REPUBLIC INTL CORP              $12.98         $18.16         28.50% Undervalued          Insurance              
     SFD        SMITHFIELD FOODS INC                $23.78         $32.99         27.90% Undervalued          Food                   
     PDFS       PDF SOLUTIONS INC                   $6.72          $9.29          27.70% Undervalued          Computer               
     BPT        BP PRUDHOE BAY ROYALTY TRUST        $117.46        $161.61        27.30% Undervalued          Petroleum              
     AVT        AVNET INC                           $35.61         $48.73         26.90% Undervalued          Electronic             

Here are some of the variables that are utilized when calculating the Fair Market Valuation of a stock: Long-run EPS growth rate, Duration of Business-growth-cycle, Volatility of EPS growth rate, Systematic or beta risk of the firm, Correlation between the firm's EPS and the interest rate environment, EPS growth volatility, Dividend payout ratio, Buffer earnings, Interest rate related criteria: Interest rate (30 year yield) long-run level, Duration of interest rate cycle, Interest rate volatility. The Fair Market Valuation uses 12-month historic and forecasted EPS values and the current 30-year treasury yield as primary determinants. When calculating risk/return values such as the Sharpe ratio, the historic periods used are five years.

Some expected results of the Valuation Model are: the valuation of a stock increases in a declining interest rate environment. Increasing current and/or projected EPS will produce a higher Valuation. While long-term EPS growth would produce a corresponding long-term Valuation increase, concomitant long-term interest rate increases would offset EPS growth and depress the Valuation. The shorter a company's own business cycle, the higher its stock Valuation will be.

AEGON N.V.-NY REG SHR (NYSE:AEG) - AEGON N.V., through its subsidiaries, provides life insurance, pensions, and investment products in the Americas, Europe, and Asia. The company also involves in accident, supplemental health, general insurance, and banking activities. Its life insurance products include permanent and universal insurance; traditional life products, such as life insurance sold as part of defined benefit pension plans, endowment policies, post-retirement annuity products, and group risk products; endowment insurance; term and whole life insurance; annuity insurance; endowment savings; variable unit linked products; and health insurance products. The company also offers individual savings and retirement products, including savings accounts and investment contracts, fixed and variable annuities, and retail mutual funds; pensions and asset management products, such as individual and corporate pensions, investment, and asset management products, as well as institutional and retail funds, and life and pensions products; and guaranteed investment contracts, funding agreements, and medium-term notes. AEGON also provides employer solutions, such as single premium group annuities; and reinsurance products and solutions to life insurance and financial services companies. In addition, it offers asset management services, including general account assets, unit-linked portfolio, and guaranteed fund; general insurance products, such as house, car, and fire insurance; supplemental health insurance; and investment advisory services. The company offers its products through financial advice channel, specialist employee benefit consultancies, independent and career agents, financial planners, registered representatives, independent marketing organizations, banks, regional and independent broker-dealers, benefit consulting firms, wirehouses, and affinity groups, as well as through online, and direct and worksite marketing. AEGON was founded in 1900 and is headquartered in The Hague, the Netherlands.

OLD REPUBLIC INTL CORP (NYSE:ORI) - Old Republic International Corporation, through its subsidiaries, engages in insurance underwriting business. It operates in three segments: General Insurance, Mortgage Guaranty, and Title Insurance. The General Insurance segment provides liability insurance coverages to businesses, government, and other institutions in transportation, commercial construction, forest products, energy, general manufacturing, and financial services sectors in North America. It provides various policies, such as automobile extended warranty insurance, aviation, commercial automobile insurance, general liability, home warranty insurance, inland marine, travel accident, and workers compensation, as well as liability coverage for claims arising from the acts of owners or employees, and protection for the physical assets of businesses. This segment also offers financial indemnity coverages, such as consumer credit indemnity, errors and omissions/directors and officers, guaranteed asset protection, and surety, as well as bonds that cover the exposures of financial institutions, and commercial and other enterprises for losses of monies, or debt and equity securities due to acts of employee dishonesty. The Mortgage Guaranty segment insures first mortgage loans, primarily on residential properties incorporating one-to-four family dwelling units to mortgage bankers, brokers, commercial banks, and savings institutions. The Title Insurance segment provides lenders' and owners' title insurance policies to real estate purchasers and investors based upon searches of the public records. It also provides escrow closing and construction disbursement services; and real estate information products, national default management services, and services related to real estate transfers and loan transactions. The company markets its products primarily through insurance agents and brokers, as well as by direct sales. Old Republic International Corporation was founded in 1887 and is based in Chicago, Illinois.

SMITHFIELD FOODS INC (NYSE:SFD) - Smithfield Foods, Inc., together with its subsidiaries, engages in the production and marketing of fresh meat and packaged meat products in the United States and internationally. It involves in the production of hog, processing of meat, production of turkey, and live cattle operations. The company offers fresh pork to retail customers as unprocessed, and trimmed cuts, such as butts, loins, picnics, and ribs; packaged meat products, including smoked and boiled hams, bacons, sausages, hot dogs, deli and luncheon meats, pepperoni, and dry meat products, as well as ready-to-eat prepared foods, such as pre-cooked entrees, and pre-cooked bacons and sausages. It sells its products to supermarket chains; wholesale distributors; the foodservice industry, including fast food, restaurant and hotel chains, hospitals, and other institutional customers; export markets, and other further processors. The company sells its products through its salespersons and independent commission brokers. Smithfield Foods, Inc. was founded in 1961 and is headquartered in Smithfield, Virginia.

PDF SOLUTIONS INC (NASDAQ:PDFS) - PDF Solutions, Inc. provides infrastructure technologies and services for the design and manufacture of integrated circuits(IC) in Asia, the United States, and Europe. It offers manufacturing process solutions that include process research and development, and process integration and yield ramp; volume manufacturing solutions; and design-for-manufacturability (DFM) solutions, such as logic DFM, circuit level DFM, memory DFM, and pdBRIX Physical IP solutions. The company also offers characterization vehicle (CV) infrastructure, which includes CV test chips, pdCV analysis software, and pdFasTest electrical wafer test system; Yield Ramp Simulator software that analyzes an IC design to compute its systematic and random yield loss; and Circuit Surfer software, which estimates the parametric performance yield and manufacturability of analog/mixed-signal/radio frequency blocks. In addition, it provides pdBRIX platform, which includes software for identifying and developing a set of physical IP building blocks that are tailored to a given manufacturing process and target product application; dataPOWER YMS platform that collects yield data, loads, and stores it in an integrated database and allows product engineers to identify and analyze production yield issues; maestria FDC software, which provides fault detection and classification capabilities to identify sources of process variations and manufacturing excursions by monitoring equipment parameters; and YA-FDC service and software platform that allows online modeling to create real-time virtual measurements of final product attributes during processing. PDF Solutions sells its technologies and services through direct sales force, sales representatives, and strategic alliances to integrated device manufacturers, fables semiconductor design companies, and foundries. The company was founded in 1992 and is headquartered in San Jose, California.

BP PRUDHOE BAY ROYALTY TRUST (NYSE:BPT) - BP Prudhoe Bay Royalty Trust operates as a grantor trust in the United States. The company holds overriding royalty interests constituting a non-operational interest in minerals in the Prudhoe Bay oil field located on the North Slope in Alaska. The Prudhoe Bay field extends approximately 12 miles by 27 miles and contains approximately 150,000 productive acres. As of December 31, 2009, its estimated, net remaining proved reserves were 68.144 million barrels of oil and condensate, of which 57.077 million barrels are proved developed reserves, and 11.067 million barrels are proved undeveloped reserves. The company was founded in 1989 and is based in New York, New York.

AVNET INC (NYSE:AVT) - Avnet, Inc., together with its subsidiaries, distributes electronic components, enterprise computer and storage products, and embedded subsystems worldwide. The company operates in two segments, Electronics Marketing and Technology Solutions. The Electronics Marketing segment markets and sells semiconductors; and interconnect, passive, and electromechanical devices to electronic component manufacturers in various industries, including automotive, communications, computer hardware and peripheral, industrial and manufacturing, medical equipment, military, and aerospace. This segment also offers various value-added services that help customers evaluate, design-in, and procure electronic components of their technology products and systems, including supply-chain management, engineering design, inventory replenishment systems, connector and cable assembly, and semiconductor programming. The Technology Solutions segment markets and sells mid-to high-end servers, data storage, and software products; and offers the services required to implement these products and solutions to the value-added reseller channel, original equipment manufacturers (OEM), independent software vendors, system builders, and system integrators. It also provides logistics, financial, marketing, sales, and technical services, including engineering support, systems integration, and configurations. In addition, this segment offers technical design, integration, and assembly to developers of application-specific computing solutions in the non-PC market, including OEMs targeting the medical, telecommunications, industrial, and digital editing markets. The company was founded in 1955 and is headquartered in Phoenix, Arizona.

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