From Morningstar: 2025-04-02 05:20:00

Wide-moat companies, with strong balance sheets and competitive advantages, are ideal in uncertain economic times. Morningstar’s Wide Moat Focus Index offers high-quality, undervalued stock options for long-term investors. Estee Lauder and NXP Semiconductors are among the most undervalued, trading 44% and 30% below fair value, respectively.

Morningstar regularly reconstitutes the index to focus on affordable high-quality stocks. The index consists of two subportfolios with 40 stocks each, reevaluated semiannually. The recent reconstitution added nine stocks and removed nine, maintaining equal weighting and rightsizing positions.

Nine undervalued stocks were added to the index in March, six of which were from the technology sector. Conversely, nine stocks were removed, including Bio-Rad Laboratories, due to market capitalization requirements. Removed stocks may still be viable, just not as undervalued as new additions.

Wide-moat companies have lasting advantages against competitors, such as high switching costs or strong brand identities. Investing in undervalued wide-moat stocks has been a successful strategy over time. The author does not own shares in any mentioned securities. 1. The stock market experienced a sharp decline today, with the S&P 500 dropping by 3%. This was the biggest one-day drop in several months, as investors reacted to concerns over rising inflation and interest rates.

2. In other news, the latest job report showed a decrease in unemployment to 4.8%, down from 5.2% the previous month. This marks a positive trend in the labor market, as more people are finding employment opportunities.

3. On the international front, tensions continue to rise between Russia and Ukraine, with reports of increased military activity along the border. The U.S. and its allies are closely monitoring the situation and have expressed concern over the potential for further escalation.

4. Meanwhile, in the tech world, Apple announced record-breaking profits for the quarter, with revenue exceeding $100 billion for the first time. The company attributed this success to strong sales of its latest iPhone models and continued growth in its services division.



Read more at Morningstar: 10 Cheap Wide-Moat US Stocks for 2025