US-listed companies are surpassing third-quarter earnings estimates, with a 12.8% growth rate expected. Over half of the stocks covered by Morningstar beat FactSet estimates by 5% or more, indicating potential undervaluation. Undervalued stocks with strong earnings and revenue results were identified through a screening process.
Biogen reported a 3% year-on-year revenue growth and 18% non-GAAP earnings per share growth. Management lowered full-year guidance but with a 1.5% improvement after adjustments. Morningstar maintains a fair value estimate of $220 per share for Biogen, viewing it as heavily undervalued with high uncertainty due to varying outcomes for Leqembi sales.
Blackstone saw a 2.2% sequential increase in fee-earning assets under management to $906.2 billion. Total revenue declined 15.7% year over year to $3.1 billion, with positive flows and growth in alternative products. With $1.242 trillion in total AUM, Blackstone remains the largest alternative asset manager globally.
Corteva reported strong third-quarter results driven by volume growth, leading to a raised guidance for 2025 and 2026. The company generated a profit this quarter with higher volumes and reduced costs. Morningstar raised its fair value estimate to $80 per share for Corteva, driven by higher near-term outlook and long-term profit margins.
Nike overcame sales declines in Greater China to post 1% growth in the first quarter of fiscal 2026. The firm is implementing strategies to rebuild relationships and innovate, leading to undervalued shares relative to their $104 per share fair value estimate. Nike’s potential for midteen operating margins is highlighted as an investment opportunity.
Royalty Pharma experienced sustained revenue growth, with portfolio receipts rising 11% year over year. Management increased guidance, fueling future collections and capital deployment. Morningstar raised the fair value estimate to $51 per share for Royalty Pharma, viewing it as undervalued despite a 6% share price increase. Shares traded up 6%, but we continue to view it as undervalued.
Read more at Morningstar: 5 Undervalued US Stocks That Crushed Q3 Earnings