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Sunday's Featured News These 3 Stocks Trade at Discounts the Market Won't Ignore ForeverWritten by Dan Schmidt. Posted: 1/5/2026. 
Quick Look - The S&P 500 posted another gain above 15% in 2025, but the market is now approaching historically concerning valuation levels.
- When valuations are elevated, slowing earnings growth is harshly punished, and investors often turn to value stocks for safety.
- These three large-cap stocks all trade well below their industry-average P/E ratios, which could help protect against market volatility in 2026.
The S&P 500 wrapped up 2025 with a total return of about 18% — the third straight year above historical norms, but below the gangbusters 25% returns of 2023 and 2024. AI euphoria remains the dominant market theme entering 2026, and the usual suspects like NVIDIA Corp. (NASDAQ: NVDA) and Alphabet Inc. (NASDAQ: GOOGL) jumped again on the first trading day. If you've ridden the AI rally since the market bottomed in 2022, you're likely sitting on substantial gains and may be looking to diversify, especially with a tech-heavy allocation. Entering 2026, the S&P 500 is trading at about 26x forward earnings — well above its 20-year average of roughly 16x. When valuations reach these levels, investors become highly focused on earnings growth, and high-multiple stocks can lose favor quickly if growth cools even slightly. If rates remain elevated, 2026 could be the year value investing re-emerges. While President Trump's official salary is $400,000 per year... his tax returns reveal he's been collecting up to $250,000 PER MONTH from one hidden source. Until recently, most Americans couldn't touch the type of investment that makes up this investment. But thanks to Executive Order 14330, that just changed. If you love investing in disruptive new companies... Discover how to invest in the fund Trump uses to collect this income >> Below are three ways to de-risk a portfolio by adding stocks that begin the year undervalued and overlooked. Each company trades at a sizable valuation discount to its industry peers, yet both fundamental and technical tailwinds suggest those discounts may not last. Comcast: Strong Balance Sheet and Sports Expansion Enhance Outlook The Comcast Corp. (NASDAQ: CMCSA) was one of the biggest victims of cord cutting, as customers migrated away from bundled cable toward a la carte streaming options. Now roughly five months from what would be a lost decade, CMCSA trades near the same price it did in May 2016. That dynamic may be shifting: some consumers are showing cord-cutting fatigue as streamers raise prices and get into costly carriage disputes with major networks. Meanwhile, Comcast has quietly built a sturdy balance sheet and diversified revenue streams. Its forward price-to-earnings (P/E) ratio of 6.84 is well below the communications industry average (16.5) and far cheaper than major competitors like The Walt Disney Co. (NYSE: DIS) and AT&T Inc. (NYSE: T). 
Comcast's broadband business is a steady, high-margin cash-flow engine. Despite Connectivity and Platforms revenue slowing 1.4% year-over-year (YOY) in Q3 2025, EBITDA margins for the residential and business segments were 37% and 56%, respectively. The advertising business should also get a boost in 2026: NBCUniversal holds rights to Super Bowl LX, the FIFA World Cup and the Winter Olympics in Italy. The company generated $4.9 billion in free cash flow in Q3 2025 as well, which supports its ~4.4% dividend. Comcast's value story may not remain hidden for long — the stock is up nearly 10% over the past 30 days, and several technical indicators point to potential further upside. Micron: An Essential AI Stock Trading at a Deep Discount How can a stock that delivered roughly a 200% gain in 2025 still look undervalued? Despite its parabolic year, Micron Technology Inc. (NASDAQ: MU) remains comparatively cheap for an AI-exposed semiconductor: it trades at about 29x forward earnings while the broader tech sector sits near 75x forward earnings. A 29x P/E is not exactly cheap versus the entire market, but it looks attractive given Micron's recent operating performance. The company is generating roughly 57% year-over-year (YOY) quarterly revenue growth, posting ~57% gross margins, and repeatedly raising guidance on earnings calls. 
Memory businesses are high-margin enterprises, and Micron's management says it is struggling to keep up with insatiable demand from data centers. The chart shows a healthy uptrend with support near the 50-day simple moving average. That aligns with TradeSmith's Health indicator — MU shares sit in the Green Zone, signaling a strong trend with normal, healthy pullbacks. Pfizer: Fueling Pipeline Innovation Through Acquisitions Shares of healthcare giant Pfizer Inc. (NYSE: PFE) have struggled since the COVID-19 pandemic receded; the stock is down more than 30% over the past five years. Rivals like Eli Lilly and Co. (NYSE: LLY) have surged thanks to obesity drugs such as Mounjaro, but Pfizer now trades near historical valuation lows — roughly 8.4x forward earnings — making it far cheaper than most large-cap pharmaceutical peers. Pfizer's acquisition of Seagen has begun to bolster its oncology business, having added more than $6 billion in revenue since the deal closed in 2023. 
Pfizer has also been shoring up its obesity-drug pipeline by acquiring two smaller drugmakers with oral and injectable candidates. The market has largely written Pfizer off in this category, creating the valuation gap. Low expectations can present opportunities — the stock doesn't fully price in successful inroads into the GLP-1 market. Additionally, Pfizer is an attractive defensive holding because of its low valuation and long history of dividend growth. Each of these companies trades at a notable discount to peers and offers a way to de-risk a portfolio without giving up exposure to secular trends such as AI, broadband infrastructure and healthcare innovation. As always, consider your time horizon and risk tolerance before making any changes to your allocation.
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