U.S. equities markets appear to be entering another rally before the year ends. Positive data from a recently issued CPI report has led many interest rate speculators to believe the Federal Reserve is just about finished with its hike cycle. The result is traders and equities investors alike allocating more capital to value stocks.
While several equities feature pretty stretched valuations, there are still some bargains to be had. Below are three value stocks with at least a 30% upside in the near term.
Walmart (WMT)
One value stock to consider is Walmart (NYSE:WMT), one of the world’s largest retailers. The retail behemoth has exhibited its ability to be nimble during the pandemic era and has relied on both in-store and e-commerce sales channels. The result has been strong single-digit revenue growth in recent years for the nation’s largest retailer.
Walmart reported strong Q3’2023 earnings, beating analysts’ expectations on both revenue and earnings per share. Walmart benefited from its diversified portfolio of products and services, its omnichannel capabilities, and its investments in innovation and expansion.
However, the retailer issued cautious guidance, citing deflation risks, which would help consumers but potentially harm company sales. I do not think this should unsettle potential investors as Walmart has shown impressive resilience in the past, even during difficult times.
Petrobras (PBR)
Petrobras (NYSE:PBR) is the state-run oil and natural gas behemoth of Brazil. Last year, global commodity prices skyrocketed, and elevated energy prices allowed Petrobras to generate $121 billion in revenue and $38 billion in net income. The stock has risen 76.2% year-to-date due to elevated energy prices and less than expected market interference from current President Luiz Inacio Lula da Silva’s government.
Petrobras recently raised its projection for oil and gas production this year, and the firm lifted its 2023 oil and gas output to 2.8 million barrels of oil equivalent per day (boed), from 2.6 million boed previously. This makes it one of those value stocks to consider.
As war rages on in the Middle East and OPEC production cuts remain in place, oil prices could climb in the near term, and Brazilian oil companies could continue to pick up the tab on providing oil to the rest of the world. Petrobras will stand to benefit from these trends, and so will its shareholders.
Coca-Cola (KO)
The beverage behemoth Coca-Cola (NYSE:KO), is the final value stock on this list that can provide decent returns in the near term. Coca-Cola owns some of the world’s most iconic and popular brands, such as Sprite, Fanta, Minute Maid, and Dasani. On top of that, the beverage company has a wide distribution network, a loyal customer base, and a strong competitive advantage. This has allowed the company to have a long history of success and stability.
In their third-quarter earnings print, Coca-Cola delivered solid results, with net revenue increasing 8% to $12 billion and organic revenue growing 11% year over year. The company saw strong growth due to consumers largely shrugging off price increases in Coca-Cola’s main beverage brands. Coca-Cola also raised its full-year outlook for both revenue and earnings, reflecting its optimism amidst an uncertain macroeconomic environment.
On the date of publication, Tyrik Torres did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
