Smart Investor: Undervalued Stocks That Crushed Earnings, Berkshire’s UnitedHealth Buy, and a New Record for Stocks

In a market reaching new highs, discerning smart investors seek hidden value in unexpected places. Here’s your primer on three high-conviction themes:

1. Undervalued stocks that smashed earnings—10 ideas analyzed

2. Berkshire Hathaway’s strategic pick into UnitedHealth

3. What’s behind the latest stock record

Let’s unpack each one, with actionable investor takeaways.

1. Undervalued Stocks That Crushed Earnings

Earnings season often reveals hidden gems—companies delivering strong results yet trading inexpensively. A recent list from Morningstar spotlights such stocks, including Pfizer, Bristol-Myers Squibb, and DraftKings, which beat Q2 expectations despite being perceived as undervalued Morningstar.

Why does this matter?

• Earnings surprises can trigger sharp stock rebounds—not just because of fundamentals, but sentiment shifts.

• Being undervalued means the upside is magnified when confidence returns.

Investor Strategy:

• Monitor earnings calendars closely, then screen for stocks with strong beats and low valuation metrics.

• Diversify across sectors, so you’re ready if biotech (like Pfizer) or gaming (like DraftKings) leads the next rally.

For deeper tactics on spotting undervalued names, check out NerdWallet’s guide on identifying undervalued S&P 500 stocks using P/E ratios and fundamental health NerdWallet.

Morningstar recently spotlighted several undervalued firms that beat earnings—stocks you might’ve missed. Here are 10 handpicked ideas, with earnings reaction, valuation metrics, and revenue context:

Here’s a curated list of 10 undervalued earnings crushers for the savvy investor to consider:

• ASML (ASML) – The semiconductor lithography leader reported strong results while appearing reasonably priced for long-term growth Morningstar.

• Hess (HES) – Energy stock with impressive Q1 earnings and value appeal Morningstar.

• Celanese (CE) – Specialty materials firm beating earnings expectations Morningstar.

• Fanuc (FANUY) – Industrial robotics maker with solid result trends and undervaluation Morningstar.

• Phillips (PHG) – Healthcare tech company that beat consensus estimates Morningstar.

• Hasbro (HAS) – Consumer staples company delivering positive surprises Morningstar.

• Mattel (MAT) – Earnings beat but stock remains underappreciated Morningstar.

• Hayward (HAYW) – Pool equipment maker with solid earnings and favorable valuation Morningstar.

• Essential Utilities (WTRG) – Utility stock surprising on earnings while trading cheaply Morningstar.

• Fanuc (again) – still worth a double mention for its earnings and valuation profile.

Investor strategies:

• Use earnings calendars and screen for stocks beating estimates by 5%+ with low forward P/E.

• Diversify across sectors—technology, energy, consumer, industrial, and utilities.

Stock Snapshots

(Note: Exact tickers and multiple data points are aggregated from Morningstar’s list and sector comparisons.)

Why these matter:

• Earnings momentum + undervaluation sets the stage for renewed investor interest.

• Aim for earnings beaters with P/E below peers and durable business models.

2. Berkshire Hathaway & UnitedHealth: A Classic Value Play

In a reminder of lessons from the past, Warren Buffett’s Berkshire Hathaway added approximately $1.57–$1.6 billion of UnitedHealth Group (UNH) to its portfolio. The move sparked a 12–14% rally in the stock—Wall Street’s “Buffett Bounce” in action The Wall Street JournalMarketWatchInvestopedia.

The appeal of UNH:

• Deep value moment: UNH had dropped over 40% on regulatory concerns, medical cost hikes, and internal leadership turbulence.

• Diversified core business: Strong balance sheet, ~2.9% dividend yield, and Buffett’s familiarity with insurance dynamics MarketWatchReutersAP News.

• Contrarian confidence: Buffett sees upside where others see risk—classic value investing.

Investor Takeaways:

• Watch for blue-chip melt-downs that still have cash flow and market dominance.

• Use Berkshire’s filings as one input—but do your own due diligence before following.

• For technical investors, charts now show UNH breaking key resistance levels around $300 and heading toward $325–$380 Investopedia.

Why it matters:

• Deep-value entry: UNH had slumped ~40% due to cost pressures, regulatory concerns, and leadership updates. Yet, Buffett saw durable fundamentals and a ~2.9% dividend MarketWatchBusiness Insider.

• Undervaluation evidenced: Analysts noted UNH trades near 90% of its five-year fair value—offering margin of safety MarketWatch.

• Market confidence rebounds: The “Buffett Bounce” propelled not just UNH, but broader healthcare peers like Centene and Elevance Health MarketWatchBarron’s.

Takeaway for investors:

• Watch fundamentally solid companies facing temporary headwinds.

• Study Berkshire’s SEC filings for insights—but always do your homework.

• Buffeted sectors like healthcare may offer rebound potential.

3. Markets Hit a New Record: Euphoria, or Something More?

Markets continue to climb. While the Dow, S&P, and Nasdaq rally, the broader sentiment sees multiple themes:

• Earning beats and strong data continue to prop up optimism.

• Morningstar flagged the overlap: “Undervalued Stocks That Crushed Earnings, Berkshire’s UnitedHealth Buy, and a New Record for Stocks” as a neat summary of market forces at play Morningstar.

Why this combination is meaningful:

• Momentum meets value—a rare alignment where beaten-down winners and broad bullishness coincide.

• Seasoned investors stay alert: record highs can precede corrections, so risk management matters.

Investors should keep an eye on signals like rising interest rates or Fed commentary—but for now, market strength offers opportunity windows.

Smart Investor Recommendations

Here’s how to position yourself to ride these megatrends—while exercising discipline and prudence:

The rally continues amid strong earnings—Morningstar reports second-highest quarterly earnings growth in over three years—and today’s record highs may reflect sustainable confidence, not bubble mentality Barron’s+1.

Investor Action Plan

Internal Links for Bloonser

You can enrich SEO and reader retention by linking to these relevant pages on your blog:

• “Berkshire Hathaway shares” (from your tags) — could link to a summary of Buffett’s strategy or his portfolio moves.

• Any prior content on investing strategies, navigating earnings season, or macro investing — helps readers deepen their understanding.

External Links for Credibility

Use these authoritative sources to validate your points and add user value:

• Morningstar on undervalued stocks Morningstar

• News on Berkshire’s UnitedHealth investment (WSJ) The Wall Street Journal

• MarketWatch analysis of the Buffett move MarketWatch

• Investopedia overview of the UNH technical setup Investopedia

• Morningstar wrap-up on market context Morningstar

Final Thoughts

In a market where records rise even as undervalued gems surface, the smart investor blends:

• Disciplined value selection (earnings beaters trading cheaply),

• Strategic contrarian alignment (like Berkshire’s UNH purchase), and

• Measured participation in broad bullish trends—always anchored in fundamentals and risk awareness.

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