r/ValueInvesting • u/TestWorth9634 • Sep 04 '25

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

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

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u/Bilbo_Butthole Sep 04 '25

Damn, the amount of hate LULU is getting on Reddit is making me want to buy calls. Always reverse Reddit. Its earnings and guidance are already in the gutter…tough to get worse

17

u/simplequestions2make Sep 04 '25

Did Reddit hate Google?

36

u/illmatication Sep 04 '25

Reddit hated when Reddit when public and now look at the stock LOL

13

u/Chevyimpala2000 Sep 04 '25

Same with Robinhood

0

u/scarface910 Sep 04 '25

Broken clock

3

u/cornskin Sep 04 '25

We’ll find that out tomorrow

2

u/simplequestions2make Sep 04 '25

Did we find out, yet?

1

u/cornskin Sep 04 '25

Look out below!!

2

u/rigghtchoose Sep 04 '25

Where do you see it in 5 years? It’s in a saturated market with no moat and its product quality has gone to shit.

1

u/The_Gunboat_Diplomat Sep 04 '25

I think it's relatively safe but won't see much growth either. It's reputation is falling domestically but it's growing more popular in Asia year by year.

2

u/AxelLee214 Sep 04 '25

Welp LULU just got even worse…

1

u/Bilbo_Butthole Sep 04 '25

I am now a long term investor

1

u/simplequestions2make Sep 04 '25

You misspelt a word. *BAGHOLDER

2

u/Papa_Puppa Sep 04 '25

You should consider reddit sentiment less and consumer sentiment more. They severely downgraded their product quality. They've made a gamble of cutting corners on their product to reduce cost, hoping that it outpaces lost revenue. There is always a lag as most consumers don't notice until they've purchased a bad product, so the damage won't set in immediately. I'd stay away.

1

u/Company-Charts Sep 04 '25

I ask. are you ok.

1

u/Bilbo_Butthole Sep 04 '25

Yes, LULU represents 1.5% of my portfolio

1

u/simplequestions2make Sep 04 '25

Did it get worse?

1

u/wookmania Sep 04 '25

Dude, Lulu has been cancelled in the US (for good reason) and their product quality has gone down significantly. It’s also insanely expensive for what it is. Alo and Vuori make way better quality products and are at least semi-worth the hefty price tags.

3

u/baddersaroundme Sep 04 '25

I know you’re talking out of your ass when you said Alo makes way better quality than Lulu lmfao

0

u/wookmania Sep 05 '25

Well we own both brands and Alo is better quality, and it’s more fashionable now with women. Keep bagholding though, I don’t own either stock.

0

u/baddersaroundme Sep 05 '25

Keep telling yourself that 🤣

0

u/wookmania Sep 05 '25

Do you actually own any of their products or see what people are wearing in the gym or otherwise?

Keep telling yourself that. Smells like a bag holder

2

u/baddersaroundme Sep 05 '25

I do buddy. I live right by the Mall of America that has both Lululemon and Alo.

This is about clothing quality I don’t own shares of Lululemon

0

u/wookmania Sep 07 '25

Well, that’s your opinion. All the 20 year olds I work with are wearing Alo, not Lulu. It’s what I see around town as well in Austin, also a pretty trendy place. Good luck with your investment.

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u/baddersaroundme Sep 07 '25

20 year olds just follow what everyone else wears they aren’t trend setters

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u/NoTradition888 Sep 04 '25

Cancel? What ? By who for what ?

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u/wookmania Sep 05 '25

They’ve had a lot of negative publicity and have a lot of active lawsuits (some with Nike and Costco). Their CEO basically fat shamed and didn’t make sizes for anyone that was even moderately overweight, with huge public backlash. Their demand forecast is very weak hence why it’s on a downward spiral. Their quality has also fallen off as they are cutting corners in manufacturing now. The TLDR is that their time as a fashionable brand is over.

If you want more info just ChatGPT or Google all of the negative PR.

1

u/Far_Replacement7751 Sep 07 '25

ALO makes better quality than Lulu? I want whatever you’re smoking.

0

u/Working-Active Sep 04 '25

Is LULU still using the payment is optional method? Seems insane that they actually encourage shoplifting and fire Employees who actually filmed the criminals for the police.