Honeywell Aerospace Joins 51 Undervalued Stocks in Morningstar's 5-Star Territory

The stock market saw significant changes in its valuation last week, with one new addition to the coveted 5-star territory. Morningstar's weekly review of US-listed stocks found that Honeywell Aerospace (HON) has joined the ranks of undervalued names, alongside 51 other companies.

The rating is determined by three factors: price, fair value estimate, and Uncertainty Rating. Stocks rated 4 or 5 stars are considered undervalued, those rated 3 stars are fairly valued, and those rated 1 or 2 stars are overvalued.

In the past week, the Morningstar US Total Market Index rose by 3.70%, leaving the overall market moderately undervalued at a 5% discount to its fair value estimate on a market-cap weighted basis.

Among the 879 US-listed stocks covered by Morningstar analysts, 34% are undervalued, 42% are fairly valued, and 23% are overvalued. The newly undervalued stocks include Honeywell Aerospace (HON), which dropped 18.49% over the past week.

Honeywell Aerospace's fair value estimate was cut to $256 from $285 during the week, with an Uncertainty Rating of Medium. The company has a wide economic moat and is in the aerospace and defense sector.