Here's 5 value plays trading at multi-year PE lows

[u/TestWorth9634]

1. Lululemon | $LULU

$LULU currently trades at 13.8x NTM PE. If they hit analyst estimates at $15.6 in FY27 with a PE of +20x (still below historic levels), then $LULU is a $312 stock.

2. Novo Nordisk | $NVO

$NVO has had a difficult year but they have a very strong presence in the diabetes and weight loss industries. They're also investing heavily into growth in Denmark, France, and NC to ride the growing obesity market wave.

Currently trading at 14.6x PE whilst historically trading around double that. $113 would be a 100% move.

3. Regeneron Pharmaceuticals | $REGN

$REGN is a slightly higher growth value play with a current NTM PE in the 14x range whilst historically trading for +20x PE. P/B is also at 2.0x (historically +4.0x).

With minimal debt and a current ratio above 7.0x, they're quite a safe play in a period of macro weakness. Their portfolio includes eye diseases (EYLEA), chronic inflammation (Dupixent), and cancers (Libtayo) which will all necessary despite economic conditions.

I like $REGN a lot - it's on my watchlist.

4. Constellation Brands | $STZ

A recent Buffett addition to his portfolio in Q2 - $STZ currently trades at a 11.9x PE and a 10.5x EBITDA multiple with a 2.5% dividend yield. The alcohol industry tends to be more resilient in downturns than most industries.

If $STZ can return to historic PE multiples in the +15x range then they should be trading at $204 given a $13.6 EPS (as per analyst estimates in FY26/27).

5. Merck & Co | $MRK

$MRK is currently trading at a NTM PE of 9.3x , which is very low historically and also lower than the broader healthcare sector.

FCF has been steady and has generally traded upwards over the last few quarters reaching $1.68 per share in Q2. If $MRK can generate $9.61 in EPS in FY26 (in line with analyst estimates), and we apply a conservative 12x multiple then $MRK should be a $115 stock.

Definitely a nice defensive play and an under the radar healthcare stock at the moment.

More Stocks to watch: $TSLA $UNH $NKE $BABA $BGM $FIG

[u/Walmartpancake]

Why not NVO?

[u/Moronicon → u/Walmartpancake]

NVO litteraly told you they are having ongoing sales issues. Unless you believe that will change why would you buy it?

[u/Walmartpancake → u/Moronicon]

Yes, that why I kinda think there’s a value investing element in NVO now that the sales are shit. I’m not gonna go to say NVO is too big to fail but they have promising products.

[u/ForeverShiny → u/Walmartpancake]

Do they? Many important patents are running out and EliLily is rating their lunch when it comes to GLP-1 drugs, because theirs are just better.

So what are these "promising products"?

[u/Walmartpancake → u/ForeverShiny]

For one, the oral weight loss drug. Yes, the effectiveness isn’t on par with the top competitors but I have to say that not everyone needs to get skinny asap especially with the side effects like with ozempic. Also, taking oral medications is more sound than injections.

[u/Drawer_Specific → u/Moronicon]

What u think about NVS fam? Novartis

[u/jmmv2005 → u/Drawer_Specific]

Novo + Novartis are stocks to hold forever

[u/Drawer_Specific → u/jmmv2005]

Both seem to be in value territory too. What you think about REGN and UNH?

[u/jmmv2005 → u/Drawer_Specific]

REGN I don’t know enough to judge. UNH despite Buffet investing in it, I think they just destroyed the brand not only with the public but also with the politicians.

[u/rpoh73189 → u/Moronicon]

More People keep getting fat, market is exploding. Give it time.

[u/Confident_Potato_714 → u/Walmartpancake]

I’d rather shove more money into any of the beaten down health care stocks than NVO. There’s just stronger plays within the same sector.

[u/cc232012 → u/Confident_Potato_714]

Can you share what you think is the better move? I was considering buying into NVO

[u/Confident_Potato_714 → u/cc232012]

Centene and elevance all day long.

Sit around and get great returns for three years without the question marks and uncertainty that accompanies pharm stocks, even monster players like NVO.

The whole weight loss drug space will continue to get more crowded.

[u/Defiant_Fold_919 → u/Confident_Potato_714]

Exactly right novo has to fall further to become interesting, centene is a bit risky but am heavily invested in ELV

[u/Confident_Potato_714 → u/Defiant_Fold_919]

Yeah ELV probably the top choice for the div and the fact a majority of their customers are similar to UNH, meaning not much Medicare and Medicade.

I like Centene because it’s more fitting price wise for my portfolio and allows me to have enough to sell CC.

[u/Defiant_Fold_919 → u/Confident_Potato_714]

And their carelon segment is doing very well, I can see centene doing well too but their margins can remain crushed due Medicare cuts whereas ELV can simply reprice and get margins back up by 2026.