As Feb. gets underway, I’m finding under-appreciated, undervalued stocks to buy. When seeking value in the stock market the hope is that other investors will see what you see: The underappreciated value inherent in strong businesses that don’t necessarily garner a lot of attention. In turn, they follow your lead, purchase en masse, and the price of your shares rises with demand. Short-term volatility will remain for those who take this approach now. But market cyclicality will do its magic and markets will again rise. That premise makes these undervalued stocks notable.  

MercadoLibre (MELI)

One of the top most undervalued stocks to buy is MercadoLibre (NASDAQ:MELI). The company operates a leading e-commerce platform in Latin America. It also operates in 18 countries in the region and offers a wide range of products and services, including online retail, and online financial services.

MercadoLibre has experienced strong growth in recent years thanks to the rapid expansion of e-commerce in the region. The stock continues to get more attention these days due to its increasing market share which has brought its price higher. I’d argue that it remains undervalued even though it isn’t far from its target price after jumping from $826 on Jan. 2 to $1,215 on Jan. 27. MELI stock is one of few e-commerce giants providing reliable returns.  

UnitedHealth (UNH) 

Next up on this list of undervalued stocks to buy is UnitedHealth (NYSE:UNH).  After doing my due diligence, it’s clear UNH is undervalued relative to its sector peers. In addition, UnitedHealth’s ROE is currently the highest it’s been over the last 10 years, at 26.94. In short, if you purchase UNH stock, anticipate that the company will turn your investment into bottom-line net income. 

Further, the company excels at creating value through the efficient use of capital. The method of measuring this is by comparing the weighted average cost of capital, WACC, against the return on invested capital, or ROIC. A higher ROIC than the weighted average cost of capital (WACC) is referred to as value creation as the capital return is greater than the cost. UnitedHealth’s ROIC is about 3% greater than its WACC. 

Cognizant Technology (CTSH)

Cognizant Technology (NASDAQ:CTSH) is another one of the top undervalued stocks to buy. Cognizant Technology Solutions is a global professional services company that provides digital, technology, consulting, and operations services to businesses and organizations with a strong presence in industries such as healthcare, financial services, and manufacturing. 

Its return on invested capital of 16.56% over the trailing 12 months exceeds its weighted average cost of capital of 9.37% over the same period(1). The same is true of its return on equity which is better than 85% of its industry peers. We can take it a step further and consider the company’s current P/E ratio of 14.42. It’s well below the firm’s 10-year median P/E ratio of 22.04. 

Golar LNG (GLNG) 

Golar LNG (NYSE:GLNG) operates a fleet of LNG carriers and floating storage regasification units, which are used to transport and regasify LNG for delivery to customers around the world.

Golar LNG is headquartered in Bermuda and has operations in various countries including the United Kingdom, Singapore, Brazil, and Norway. That geographically disparate operational footprint allows the company to strategically supply its partners in a geopolitically tense world. The company’s business model is based on long-term, fixed-rate charters, which provide a steady stream of revenue and further serve to help to mitigate the impact of fluctuations in the LNG market.

Wall Street currently rates GLNG stock as a unanimous buy with roughly 50% upside. In terms of traditional value metrics, Golar LNG benefits from a very low P/E ratio of 3.48, lower than 83% of the oil & gas industry. GLNG stock is currently cheap and it’s also a reasonable hedge against volatility due to its business model. 

Goodyear Tire (GT)

My colleague Joel Baglole recently commented on Goodyear Tire’s (NASDAQ:GT) horrific performance over the last five years, pointing out the fact that it has lost 70% of its value in the period. 

He noted that Goodyear, despite being a household name in the U.S., has struggled with competition and a particularly tough 2022 in which prices fell off a cliff on high commodity prices and a strong dollar that weakened the impact of foreign sales when remunerated to its U.S. headquarters as dollars. 

Perhaps most importantly, though, is the notion that Goodyear is letting it be known that it is lessening its reliance on rubber. The company unveiled a tire made with 90% sustainable materials at the Consumer Electronics Show (CES). If the company can get media outlets on board with the idea that it is turning a page and becoming greener, investor capital could logically get behind the company again. At such low prices, it’s easy to see why GT stock is currently one to consider. 

Regeneron Pharmaceuticals (REGN) 

Regeneron Pharmaceuticals (NASDAQ:REGN) stock price is highly dependent on the sales level of its current portfolio of drugs. 

Let’s start with those sales first. A few weeks ago, REGN stock dropped precipitously on the news that sales of its eye disorder treatment, Eylea, could fall short of levels anticipated on Wall Street. Data suggested that patients were switching to a competitor product as cost dynamics temporarily shifted out of favor for Eylea. The result was that preliminary Q4 sales were pegged at $1.5 billion, well below the $1.64 billion anticipated. However, analysts then suggested that dynamics were shifting back in favor of Eylea, and REGN clawed back the losses. 

Investors should note that Regeneron is among the more profitable firms in the highly profitable pharmaceutical industry. Its ROIC of 33.93% over the last 12 months is 10X greater than its 3.36% WACC. 

Diamondback Energy (FANG) 

Diamondback Energy (NASDAQ:FANG) is an independent oil and natural gas company engaged in the acquisition, development, exploration, and production of unconventional, onshore oil and natural gas reserves in the Permian Basin in West Texas and New Mexico. The company has a market capitalization of approximately $24 billion. FANG stock is undervalued based on the simple idea that it currently trades for less than its target stock price. FANG also carries a strong dividend yield of 6.25% at the moment.

On the date of publication, Alex Sirois 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.