10 Best Value Stocks for Long-Term Investors: Morningstar

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Growth stocks have roared back this year after lagging value stocks during a tough 2022. Through mid-May, the Morningstar US Growth index has outperformed the Morningstar US Value index by more than 15 percentage points, Susan Dziubinski, an investment specialist at the firm, wrote in a blog post released Wednesday.

But that doesn’t mean growth stocks are throwing bargains at investors as they did heading into 2023. From a price perspective, value stocks today look like the better long-term investment, according to Dziubinski.

U.S. market strategist David Sekera, Dziubinski’s colleague, wrote in his May stock market outlook: “While we still see an overweight opportunity in the value category, which trades at a 15% discount, it is now time to move to a market-weight position in growth from overweight as the category now trades in line with the broad market.”

Morningstar analysts have dipped into the value portion of the firm’s Style Box, and compiled a list of the best value stocks to buy for the long term.

These stocks are from companies included on Morningstar’s list of the Best Companies to Own for 2023, ones with wide Morningstar economic moat ratings. This means they are stable or growing and have predictable cash flows, and they are led by management teams that make smart capital allocation decisions.

And as a boon for investors, the stocks are cheap, trading below their fair value estimates.

See the gallery for the 10 best value stocks on Morningstar’s list, with year-to-date performance as of May 17.

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