3 Undervalued S&P 500 Stocks to Buy Before Wall Street Catches On

Snap-On (SNA)

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Snap-On (NYSE:SNA) has been a steady performer for a long time. Its 5-year annualized total return is 13.01%, 258 basis points higher than the SPDR S&P 500 ETF Trust (NYSEARCA:SPY). Yet its earnings yield remains a healthy 6.8%.

I have a remarkably similar philosophy about globalization as Snap-On CEO Nick Pinchuk. For a long time, I’ve praised the business model of A.O. Smith (NYSE:AOS) because most of what it makes in America is sold in America. The same is valid overseas.

Recently, Pinchuk appeared in an interview with Chief Executive, extolling the virtues of American manufacturing.

“‘Eighty percent of what we sell in America is made right here in America,’ says Pinchuk, whose Kenosha, Wisconsin-based company produces high-end tools and equipment for transportation-industry technician. ‘Our plants in Europe make for Europe, our plants in Asia make for Asia,’” Chief Executive reported.

As Pinchuk explained, the company’s tools and equipment are highly customized, and it would be impractical to ship its 85,000 stock-keeping units (SKUs) across the Pacific.

Those sound like identical words to the A.O. Smith CEO. And they make total sense.

On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Will Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia.

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