3 Stocks Every Value Investor Should Watch Out for Right Now

It doesn’t matter whether an investor manages a small personal portfolio or millions of dollars in a vehicle like an investment fund; when it comes to the discipline of value investing, one thing remains true. This characteristic is that these investors must be willing to place relatively contrarian bets, which is essentially where value is found.

Buying beaten-down stocks that have received negative media attention or been outright forgotten by the broader market doesn’t seem like the most productive use of an investor’s time or capital; however, these are the decisions that pay the most dividends down the line.

Today, three particular names could offer just that, a big dividend payment in the form of appreciation in the coming quarters.

Within the retail sector, investors can add shares of Target Corp. (NYSE: TGT) to their list of discounted names with asymmetrical upside potential. Diversifying from this tariff-affected space, other names like Southwest Airlines Co. (NYSE: LUV) and PayPal Holdings Inc. (NASDAQ: PYPL)can also fit this criteria for unfair discounts that turn these companies into value plays.

A 50% Discount From the Average for Southwest Airlines

Not only does this stock trade at only 80% of its 52-week high, providing enough upside room for investors to take advantage of, but when valuation multiples are considered, the company appears to offer a potential 50% discount in one specific metric.

On a price-to-book (P/B) multiple basis, a 2.0x measure stands roughly 50% below the long-term average of 4.0x for this airline, meaning there must be something happening in the macro for markets to feel like this company’s book should be at this much of a discount.

Turns out, Southwest Airlines’ biggest moat and advantage comes from its fuel hedging abilities in the oil markets. With the price of oil seeing less than average volatility lately, it would make sense for the market to expect lower earnings and book value in the future.

However, Wall Street analysts would differ. Understanding that inflation is stickier than the Federal Reserve would like. Inventories are at cyclical lows, and Southwest Airlines could report up to $0.82 in earnings per share (EPS) for the fourth quarter of 2025, implying a jump of 90% from today’s reported $0.43.

Institutional Capital Likes Target Stock

One of the most popular supermarket chains is none other than Target. Whether it is due to convenience or its ability to stay up to consumer trends among younger customers, Target seems to have become the preferred shopping destination for groceries and home needs.

This is a moat in itself, and one that shouldn’t be forgotten just because the stock trades at a dismal 61% of its 52-week high, just the opposite, actually. Knowing that customer loyalty abounds for Target, and that management has been investing in improving the customer experience at its stores, some savvy institutions have decided to adopt this name.

Such as those from Nordea Investment Management, who, as of late July 2025, justified a boost of 37.4% to their Target stock holdings, bringing their net position to as much as $196.1 million today, giving retail investors a sound vote of confidence to consider moving forward.

As always, EPS growth also stands behind this seeming discount and upside potential, as Wall Street analysts now expect up to $2.47 in EPS by the fourth quarter of 2025, in other words a jump of 90% compared to today’s earnings, such financial growth is sure to have a positive influence on the stock’s price coming up.

Analysts Love the PayPal Story

As the rise of stablecoins could threaten the positioning of the financial behemoths, a company that is already positioned in the world of hybrid currency (a mix between fiat and crypto) is likely to do well in the future of payment processing and commercial banking solutions.

This is where PayPal comes into play, sporting a price that’s only 75% of its 52-week high and fundamentals that are as solid as they were when the stock was flirting with making a new high for the year. With this in mind, PayPal can be considered a sort of “low-hanging fruit” for investors and analysts alike.

PayPal can be seen as an easy win for analysts to boost, strengthening their reputations and careers, as these analysts are typically wary of boosting a stock that has been beaten down, such as PayPal has been. Canaccord Genuity Group analyst Joseph Vafi is one of the latest to reiterate a Buy rating for PayPal, along with a $96 per share valuation.

Compared to today’s low prices, this target would imply investors can shoot for a potential rally of as much as 37% from where PayPal stock has fallen to today, making it another great value play to consider in today’s market.

Written by Gabriel Osorio-Mazilli

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