Investing
Six blue-chip names are 20%-plus off their highs. Which are bargains?
By Bear Creek Staff, . Bear Creek Capital Network.
Six household names are lagging badly in a bull market, and The Motley Fool has gone through each one to assess whether the discount is an opportunity or a warning.
The S&P 500 is up 14% year to date, according to the piece. Against that backdrop, Nike, Goldman Sachs, Intel, Disney, Pfizer, and Home Depot are all at least 20% off their all-time highs.
Nike and Intel get the clearest verdicts
Nike draws the most direct caution. Sales fell 4% year over year in the fiscal first quarter ended August 31, and management is still forecasting a decline for fiscal 2027. The stock trades at 17 times trailing twelve-month earnings, but the piece calls it a potential value trap, citing ongoing market-share losses to Brooks, Hoka, and local Chinese brands, and noting that "there are more compelling stories in the market."
Intel is the outlier in the group: it is up 163% this year even while remaining well off its all-time high. Sales rose 25% year over year in the fiscal second quarter ended June 27, and management guided for roughly 18% growth in the third quarter. The stock trades at 8.8 times trailing twelve-month sales. The piece flags persistent profitability problems and advises caution despite the AI tailwind behind central processing units.
Goldman, Disney, Pfizer, and Home Depot land in murkier territory
Goldman Sachs reported strong third-quarter results, with equities revenue up 72% over the prior year and investment banking fees up 21%, driven partly by its role as a lead underwriter on the Space Exploration Technologies IPO. The stock has pulled back since a July high on bond-market volatility and interest-rate concerns. At roughly 13 times trailing earnings and 2.4 times book value, the piece concludes it is not cheap enough to qualify as a bargain.
Pfizer trades at 37 times trailing earnings, a figure elevated by recent quarterly net losses. Its dividend yields more than 6%. The piece notes returning revenue growth and a pipeline of new medications, including the recent acquisition of Metsera, which is developing a GLP-1 weight-loss drug. The framing is cautiously positive for income-focused holders, but the valuation is hard to call cheap.
Disney carries a price-to-earnings ratio of 22 and a record of declining broadcast revenue, streaming losses, and box-office disappointments. The piece allows that risk-tolerant investors might take a position as streaming moves toward profitability, but does not call it a clear buy.
Home Depot trades at a price-to-earnings ratio of 21, just below its ten-year average. Its dividend yield is 3.2%, above its historical norm. The piece credits the company for producing comparable-sales growth in a weak housing environment but notes that a recovery may be slow given the likelihood of further interest-rate increases.
What the analysis does and does not establish
The Motley Fool piece is an opinion column by a named contributor, Jennifer Saibil, and the valuations and characterizations are hers. The disclosure notes that she holds Apple shares and that The Motley Fool holds positions in several of the companies discussed, including Goldman Sachs, Home Depot, Intel, Nike, Pfizer, and Walt Disney. Readers should weigh that context.
What the piece does not address is how each stock's current multiple compares with its own historical range, or with sector peers, beyond the Home Depot ten-year average. A 17 times earnings multiple for Nike and a 22 times multiple for Disney are presented as judgments rather than benchmarks, so the reader is largely taking the columnist's read on what is and is not expensive.
The practical question for anyone watching these names: the stocks that look most like traps, Nike and Intel in different ways, are also the ones with the clearest near-term catalysts being cited as reasons for optimism. That tension between a difficult present and a plausible recovery story is exactly where valuation calls tend to go wrong in both directions.
Bear Creek Capital Network publishes content for informational and educational purposes only. Nothing in this article constitutes financial, investment, tax or legal advice, or a recommendation to buy or sell any security. Consider your own circumstances and consult a qualified professional before making financial decisions.