10 Stocks Selling at the Deepest Discounts

BOSTON (TheStreet) -- U.S. stocks slid last month, with the S&P 500 falling 4.7% as investors loaded up on fixed-income securities. Here are 10 stocks struggling despite cheap price-to-earnings ratios. When stocks rebound, these stocks may fare best. The companies are ordered by forward earnings multiple, from cheap to cheapest. 10. Humana HUM offers health and supplemental benefit plans. Second-quarter profit increased 21% to $340 million, or $2 a share, as revenue grew 9.5% to $8.7 billion. The operating margin rose from 5.9% to 8.2%. Humana has $8.9 billion of cash and $1.7 billion of debt, equal to a quick ratio of 1.7 and a debt-to-equity ratio of 0.3. During the past three years, Humana has grown revenue 11% annually, on average, and boosted profit 24% a year. Its stock trades at a trailing earnings multiple of 7.1, a forward earnings multiple of 8.6, a book value multiple of 1.3, a sales multiple of 0.3 and a cash flow multiple of 3.6 -- 51%, 31%, 48%, 60% and 59% discounts to peer averages. Of analysts covering Humana, 9, or 43%, advise purchasing its shares, 11 recommend holding and one suggests selling them. A median price target of $55.73 suggests a return of 16%. 9. Goldman Sachs GS is a global full-service investment bank. Second-quarter profit tumbled 82% to $613 million, or 78 cents a share, as revenue decreased 31% to $10 billion. The operating margin narrowed from 42% to 40%. Goldman Sachs has $258 billion of cash and $540 billion of debt, equal to an elevated debt-to-equity ratio of 7.3. Since 2007, Goldman has increased net income 5.9% a year, though earnings per share fell 2.6% a year. Its stock sells for a trailing earnings multiple of 7.2, a forward earnings multiple of 7.7, a book value multiple of 1, a sales multiple of 1.5 and a cash flow multiple of 2.1 -- 46%, 45%, 35%, 31% and 85% discounts to capital markets industry averages. Of researchers following Goldman, 24, or 86%, rate its stock "buy" and four rate it "hold." None rank it "sell." A median target of $189.79 implies 39% of upside. Deutsche Bank DB offers a price target of $205. 8. SLM Corp. SLM provides education finance in the U.S. SLM swung to a second-quarter profit of $338 million, or 63 cents a share, from a loss of $123 million, or 31 cents, a year earlier. Revenue gained 13%. The operating margin narrowed from 61% to 57%. SLM Corp. holds $13 billion of cash and $199 billion of debt, equal to an excessive debt-to-equity ratio of 39. During the past three years, SLM's net income has dropped 8.5% a year, on average. Its stock trades at a trailing earnings ratio of 5.4, a forward earnings multiple of 7.7, a book value multiple of 1.1 and a sales multiple of 0.8 -- 58%, 37%, 51% and 43% discounts to consumer finance industry averages. Of analysts evaluating SLM Corp., six, or 60%, rate its stock "buy" and four rate it "hold." None rank it "sell." A median target of $15.50 suggests a potential return of 40%. FBR FBCM offers a price target of $19, implying 71% of upside. To read the rest, head over to TheStreet.com