Each week, we screen the US-listed stocks under Morningstar’s coverage for newly undervalued names.

For the week ended Sept. 27, three stocks dropped into undervalued territory, meaning their Morningstar Ratings changed to 4 or 5 stars. Stocks rated 3 stars are fairly valued according to Morningstar analysts, while those rated 1 or 2 stars are considered overvalued.

The three newly undervalued stocks, ordered by market cap, are:

• Mizuho Financial Group MFG
• IQVIA IQV
• MongoDB MDB

All data in this article is sourced from Morningstar Direct.

New 4-Star Stocks for the Week Ended Sept. 27

The Morningstar US Market Index rose 0.62% over the past week, leaving the overall US stock market moderately overvalued, hovering at a 7% premium to its fair value estimate on a cap-weighted basis.

Of the 880 US-listed stocks covered by Morningstar analysts:

• 31% are undervalued, 43% are fairly valued, and 26% are overvalued.
• Three are newly undervalued.
• 16 are newly overvalued.
• None moved from a 4-star rating to a 5-star rating.
• 10 moved from a 5-star rating to a 4-star rating.
• 21 are no longer undervalued.

Morningstar analysts assign every stock under their coverage a fair value estimate, which is an intrinsic measure of its worth, and an uncertainty rating, which captures the range of potential outcomes for that estimate. A higher uncertainty rating equates to a larger range of prices considered fair. These two metrics and the stock’s price determine its Morningstar Rating.

Metrics for this Week’s New 4-Star Stocks

Mizuho Financial Group

• Morningstar Rating: 4 stars
• One-Week Return: -3.84%

Regional bank Mizuho Financial has dropped 2.67% over the past three months and climbed 16.83% over the past year. The stock trades at a 13% discount to its fair value estimate of $4.61, with a medium uncertainty rating. Mizuho Financial is a large-value company with no economic moat.

IQVIA

• Morningstar Rating: 4 stars
• One-Week Return: -3.03%

Diagnostics and research firm IQVIA is up 10.36% over the past three months and 16.11% over the past year. The stock’s price is 12% below its fair value estimate of $268, with a medium uncertainty rating. The mid-core stock has a narrow economic moat.

MongoDB

• Morningstar Rating: 4 stars
• One-Week Return: -3.20%

Software infrastructure firm MongoDB has climbed 10.40% over the past three months and dropped 17.87% over the past year. The stock is trading at an 18% discount to its fair value estimate of $330, with a high uncertainty rating. MongoDB is a mid-growth company with no economic moat.