23 New 4-Star Stocks This Week

Every Monday, get Morningstar’s insights on company news, the latest stock market trends, and in-depth company reports from our analysts. Sign up for our Stock Strategist newsletter here.

Once a week, we screen the US-listed stocks under Morningstar’s coverage for newly undervalued names—those whose prices have just fallen into ranges worthy of 4- or 5-star

. For the week ended March 20, 23 stocks saw their ratings change to 4 stars, while 10 joined the 72 US-listed names in 5-star territory.

The five new 4-star stocks with the largest market capitalization are:

• HSBC Holdings HSBC
• Pepsico PEP
• Boeing BA
• Ecolab ECL
• DoorDash DASH

The full list of new 4-star stocks can be found at the bottom of this story. All returns in this article are reported in the stock’s base currency and all data is sourced from Morningstar Direct.

What Is the Morningstar Rating for Stocks?

The Morningstar Rating can help investors identify stocks that are truly undervalued or overvalued, cutting through the market noise. The rating is determined by three factors: a stock’s price, its

—Morningstar’s estimate of its intrinsic worth—and its , which captures the range of potential outcomes for that estimate. Stocks rated 4 or 5 stars are considered undervalued, those rated 3 stars are fairly valued, and the ones rated 1 or 2 stars are considered overvalued.

The Latest Stock Valuation Changes

The Morningstar US Market Index fell 1.82% over the past week as of March 20, leaving the overall US stock market significantly undervalued, hovering at a 13% discount to its fair value estimate on a market cap-weighted basis.

Of the 832 US-listed stocks covered by Morningstar analysts:

• 42% are undervalued, 41% are fairly valued, and 17% are overvalued.
• 23 are newly undervalued.
• Five are newly overvalued.
• 10 moved from a 4-star rating to a 5-star rating.
• Two moved from a 5-star rating to a 4-star rating.
• None of the newly undervalued stocks went from a 3-star rating to a 5-star rating.
• One is no longer undervalued.

Metrics for This Week’s New 4-Star Stocks

HSBC Holdings

• Morningstar Rating: ★★★★
• Fair Value Estimate: $89.00
• Uncertainty Rating: Medium

Following a 1.59% loss over the past week, diversified bank HSBC saw its Morningstar Rating move to 4 stars from 3. HSBC has gained 1.60% over the past three months and 40.69% over the past year. The large-value stock has a narrow economic moat. HSBC is trading at a 14% discount to its fair value estimate of $89 per share, with an Uncertainty Rating of Medium.

Pepsico

• Morningstar Rating: ★★★★
• Fair Value Estimate: $166.00
• Uncertainty Rating: Low

Non-alcoholic beverages company Pepsico lost 6.15% over the past week, shifting its Morningstar Rating to 4 stars from 3. Pepsico has climbed 2.17% over the past three months and 6.04% over the past year. The stock is trading at a 10% discount to its fair value estimate of $166 per share, with an Uncertainty Rating of Low. Pepsico is a large-value company with a wide economic moat.

Boeing

• Morningstar Rating: ★★★★
• Fair Value Estimate: $246.00
• Uncertainty Rating: High

Aerospace and defense company Boeing dropped 7.04% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is down 8.86% over the past three months and is up 12.90% over the past year. The stock’s price is 21% below its fair value estimate of $246 per share, with an Uncertainty Rating of High. The large-growth stock has a wide economic moat.

Ecolab

• Morningstar Rating: ★★★★
• Fair Value Estimate: $300.00
• Uncertainty Rating: Medium

Specialty chemicals company Ecolab lost 6.21% over the past week, shifting its Morningstar Rating to 4 stars from 3. Ecolab has dropped 2.44% over the past three months and has climbed 2.87% over the past year. The stock is trading at a 15% discount to its fair value estimate of $300 per share, with an Uncertainty Rating of Medium. Ecolab is a large-core company with a wide economic moat.

DoorDash

• Morningstar Rating: ★★★★
• Fair Value Estimate: $205.00
• Uncertainty Rating: Very High

Following a 2.93% loss over the past week, internet retail company DoorDash saw its Morningstar Rating move to 4 stars from 3. DoorDash has lost 33.13% over the past three months and 18.81% over the past year. The mid-growth stock has a narrow economic moat. DoorDash is trading at a 24% discount to its fair value estimate of $205 per share, with an Uncertainty Rating of Very High.