23 New 4-Star Stocks This Week

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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 July 31, 23 stocks saw their ratings change to 4 stars, while two joined the 63 US-listed names in 5-star territory.

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

• ASML ASML
• Linde LIN
• Marvell Technology MRVL
• Monolithic Power Systems MPWR
• American Electric Power AEP

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 Total Market Index rose 0.95% over the past week as of July 31, leaving the overall US stock market moderately undervalued, hovering at an 8.00% discount to its fair value estimate on a market-cap-weighted basis.

Of the 879 US-listed stocks covered by Morningstar analysts:

• 34% are undervalued, 44% are fairly valued, and 22% are overvalued.
• 23 are newly undervalued.
• 15 are newly overvalued.
• Two moved from a 4-star rating to a 5-star rating.
• 21 moved from a 5-star rating to a 4-star rating.
• None of the newly undervalued stocks jumped from a 3-star rating to a 5-star rating.
• 30 are no longer undervalued.

Metrics for This Week’s New 4-Star Stocks

ASML ASML

• Morningstar Rating: ★★★★
• Fair Value Estimate: $2,050.00
• Uncertainty Rating: High

Semiconductor equipment and materials firm ASML dropped 7.16% over the past week, bumping its Morningstar Rating to 4 stars from 3. The company’s stock is up 13.36% over the past three months and 136.05% over the past year. The stock’s price is 21% below its fair value estimate of $2,050 per share, with an Uncertainty Rating of High. The large-growth stock has a wide economic moat.

Linde LIN

• Morningstar Rating: ★★★★
• Fair Value Estimate: $540.00
• Uncertainty Rating: Low

Following a 6.62% loss over the past week, specialty chemicals company Linde saw its Morningstar Rating move to 4 stars from 3. Linde has lost 4.24% over the past three months and has gained 5.33% over the past year. The large-core stock has a wide economic moat. Linde is trading at an 11% discount to its fair value estimate of $540 per share, with an Uncertainty Rating of Low.

Marvell Technology MRVL

• Morningstar Rating: ★★★★
• Fair Value Estimate: $235.00
• Uncertainty Rating: High

Semiconductor company Marvell lost 3.43% over the past week, shifting its Morningstar Rating to 4 stars from 3. Marvell has climbed 13.60% over the past three months and 133.87% over the past year. The stock is trading at a 20% discount to its fair value estimate of $235 per share, with an Uncertainty Rating of High. Marvell is a large-growth company with a narrow economic moat.

Monolithic Power Systems MPWR

• Morningstar Rating: ★★★★
• Fair Value Estimate: $1,650.00
• Uncertainty Rating: High

Semiconductor company Monolithic Power climbed 6.91% over the past week. The company’s stock is down 11.54% over the past three months and is up 101.84% over the past year. The stock’s fair value estimate rose to $1,650 per share from $1,500 during the week. It ended the week trading at a 14% discount to its new fair value estimate, with an Uncertainty Rating of High. The mid-growth stock has a wide economic moat.

American Electric Power AEP

• Morningstar Rating: ★★★★
• Fair Value Estimate: $141.00
• Uncertainty Rating: Low

Following a 5.67% loss over the past week, American Electric saw its Morningstar Rating move to 4 stars from 3. American Electric has lost 6.07% over the past three months and has gained 16.56% over the past year. The mid-core stock has a narrow economic moat. American Electric is trading at a 9% discount to its fair value estimate of $141 per share, with an Uncertainty Rating of Low.