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Exclusive Content from MarketBeat 3 Undervalued Names Too Cheap to IgnoreAuthor: Nathan Reiff. Published: 3/7/2026. 
What You Need to Know - Several established companies present potential value plays in early 2026 thanks to comparably low P/E ratios and strong fundamentals, despite broader market challenges.
- Merck's recent rally has not compromised its P/E ratio, which remains below the industry average, as the company navigates new ways to grow revenue amid its flagship Keytruda nearing patent expiration.
- Campbell's and US Foods offer contrasting cases: the former experiencing a sharp pullback and a high dividend yield, while the latter rallying amid adjusted EBITDA gains and the potential for further improvement.
Highly publicized growth trajectories of some of the biggest companies out there may make it seem like 2026 is not a prime time for a value strategy. Still, some fairly sizable firms are trading at attractive valuations and offer potential for share price appreciation alongside fundamental growth. The companies below all represent potential value plays, including metrics that are historically low and/or competitive relative to peers or the broader market. They offer added benefits such as compelling dividends or promising new product developments. While value opportunities may be harder to find when many promising companies have already attracted renewed investor attention — and while some stocks that appear cheap carry operational red flags — well-established, stable names can still be attractive value prospects. Even After Rally, Merck May Be Undervalued, With Careful Planning for Keytruda in the Works Although shares have climbed more than 28% in the last year, bringing its market capitalization to nearly $300 billion, biopharma giant Merck & Co. Inc. (NYSE: MRK) still trades at a price-to-earnings (P/E) ratio of 16.45 — well below the medical industry average of roughly 27. Analysts expect continued growth: the company is projected to see earnings rise by nearly 10% in the coming year and has a 5% additional upside in the near term. Driving Merck's momentum is its pembrolizumab cancer drug, Keytruda, which was approved for subcutaneous injection by the European Commission in late 2025 and reached about $8.4 billion in sales in Q4 2025 — an increase of almost 7% year-over-year (YOY). Keytruda also shows promise in ovarian cancer, potentially attracting a new group of patients. These factors should help Merck build revenue as it prepares for Keytruda's patent expiration in 2028. Merck's drug portfolio is broadening. It recently announced notable phase 3 trial results for clesrovimab-cfor (Enflonsia), a treatment for RSV in young children. At the same time, the company is taking strategic steps to prepare for Keytruda's patent loss, splitting its human health branch into two separate units to make it easier to grow non–cancer-drug sales. A Difficult External Situation Pressures Campbell's, But Strong Dividend and Value Remain Factors Campbell’s (NASDAQ: CPB) shares have fallen about 37% over the last year as the food-and-beverage staple has faced pressure from tariffs and inflation. In Q1 fiscal 2026, which ended Nov. 2, 2025, the company reported modest year-over-year (YOY) declines in organic net sales and consumption, and adjusted earnings per share (EPS) fell by 13%. So far, margin improvement has been limited despite cost-saving measures. The near term will likely remain challenging for the iconic food brand, as fiscal-year guidance is soft overall. Still, an improving supply chain and strong brand loyalty — particularly for its premium offerings — should help protect the company. Changes in tariff policy could also ease some of the pressure it has been facing. On top of that, Campbell's remains a notable dividend play, with an attractive yield of 5.9%, although its payout ratio is relatively high at over 80%. Moreover, Campbell's P/E ratio of 13.5 is the lowest it has been in about four years. These factors may convince some investors the stock is worth the risk, despite caution among Wall Street analysts. A Recent US Foods Rally May Continue as Bottom-Line Growth Remains in Place Foodservice distribution leader US Foods (NYSE: USFD) has moved in almost the opposite direction of Campbell's — shares have climbed about 33% in the past year. Its P/E ratio sits at 31.6. On the fundamentals, US Foods is making meaningful progress: the company reported improved profitability in the latest quarter and full-year adjusted EBITDA gains of 11% YOY. Better inventory management and cost-of-goods savings are also helping the firm gain traction. With a $4 billion capital deployment strategy in place, US Foods is positioned to sustain revenue growth momentum and continue expanding adjusted EBITDA. Analysts rate USFD a Moderate Buy based on 11 Buys and 2 Holds, with roughly 15% upside potential.
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