Top 5 US Stocks To Buy In September 2024

These 5 stocks are our top Pro Picks for this month, taken from S&P 500-listed companies that have garnered high InvestingPro health ratings (benchmarked against more than 100 financial factors and indicators from companies in the same sector), as well as from among those trading well under our proprietary fair value estimates (based on 5 overlaid investing models) and analyst assessments.

All of these names have earned InvestingPro health scores of well above 3.00, which for the last 7 years has indicated outperformance vs. the S&P 500. A score this high points to a mix of first-rate financials: excellent earnings, cash flow, and growth vs. peers in its sector.

Importantly, all of these stocks are also currently undervalued per InvestingPro’s fair value calculations and favored by Wall Street analysts polled by InvestingPro. They’re also sitting with a current potential upside of more than 20%. So if you’re eager to bulk up your portfolio, these overlooked powerhouse plays are all worth serious consideration.

• InvestingPro health score: 3.86 / 5.00
• InvestingPro average fair value: $45.53 / 28.4% upside
• Fair value confidence: Medium
• Industry: Healthcare / Pharmaceuticals

Harmony Biosciences Holdings (HRMY) could be an intriguing stock pick for September 2024, especially for investors seeking new opportunities within the biotech sector. As of the end of Q2 2024, Harmony Biosciences boasts a market capitalization of approximately $2.0 billion, positioning it as a mid-cap pharmaceutical company with significant growth prospects. The company’s focus on developing therapies for rare neurological conditions has garnered strong market interest and a positive outlook from industry analysts.

Harmony Biosciences does not currently offer a dividend, opting instead to reinvest its earnings into research and development to further advance its robust pipeline. The stock carries a P/E ratio of 17.5, suggesting it may be undervalued when compared to its peers in the biotech sector, and thus offering potentially attractive upside for investors. However, it’s crucial to note that investments in biotech stocks can be volatile, primarily driven by the outcomes of clinical trials and regulatory approvals.

Debt levels for Harmony Biosciences are well-managed, providing the company with the financial flexibility needed for strategic initiatives and expansions. Recently, the company announced positive Phase 3 trial results for its leading product candidate, which has helped boost investor confidence and could drive near-term growth.

Overall, Harmony Biosciences offers a compelling mix of innovative pipeline developments and solid financial health, presenting an appealing opportunity for investors looking for exposure to the biotech space.

• InvestingPro health score: 3.60 / 5.00
• InvestingPro average fair value: $61.12 / 20.9% upside
• Fair value confidence: Medium
• Industry: Energy / Oil, Gas & Consumable Fuels

As of the end of Q2 2024, International Seaways has a market capitalization of approximately $2.51 billion, making it a notable mid-cap company within the shipping sector. The company operates a diverse fleet of vessels that transport crude oil and refined petroleum products globally, benefitting from robust demand in the energy sector.

One of the appealing aspects of International Seaways is its attractive dividend yield, currently standing at 11.5%, providing investors with steady income alongside potential capital appreciation. The stock holds a P/E ratio of 4.8, indicating that it might be undervalued in comparison to its sector peers, thus offering significant upside potential. However, investors should note that the shipping industry can be subject to cyclicality and volatility, influenced by fluctuating freight rates and changes in global trade dynamics.

The company’s debt levels are reasonable, allowing it to maintain financial flexibility for fleet upgrades and strategic acquisitions. Recent quarterly results showcased strong revenue growth and improved operational efficiency, further boosting investor confidence.

Overall, International Seaways presents a compelling investment opportunity, combining a solid dividend yield with considerable growth potential, making it well-suited for investors who are looking for stable returns within the maritime shipping sector.

• InvestingPro health score: 3.18 / 5.00
• InvestingPro average fair value: $2,140 / 19.3% upside
• Fair value confidence: Medium
• Industry: Financials / Insurance

White Mountain Insurance (WTM) is a noteworthy stock pick for investors as we move into September 2024. As of the end of August 2024, White Mountain Insurance boasts a market capitalization of approximately $4.54 billion, positioning it as a solid player in the insurance sector. The company has been making significant strides in diversifying its portfolio, which primarily includes property and casualty insurance, as well as reinsurance policies. This diversification helps mitigate risk and provides a comprehensive range of services.

WTM currently offers a nominal dividend of 0.1%, which it has paid out consistently for more than 30 years. The company chooses instead to focus on reinvesting earnings into business expansion and operational enhancements. The company’s price-to-earnings (P/E) ratio stands at 9.4, making it an appealing option for value-focused investors who believe in the company’s long-term growth. The insurance sector’s generally stable cash flows make WTM a low-volatility asset, although the stock could experience fluctuations driven by broader economic conditions and catastrophic events.

White Mountain Insurance maintains a conservative approach to debt, ensuring a robust balance sheet that allows for strategic acquisitions and investments without compromising financial stability. Investors should take note of the recent positive quarterly earnings report, which highlighted a year-over-year revenue increase of 12%.

In summary, White Mountain Insurance presents a compelling investment opportunity with promising upside potential, backed by a solid financial foundation and strategic growth initiatives. Investors looking for a reliable yet growth-oriented investment might find WTM to be a valuable addition to their portfolios.

• InvestingPro health score: 3.35 / 5.00
• InvestingPro average fair value: $123.45 / 50.6% upside
• Fair value confidence: Medium
• Industry: Marine Transportation

Danaos Corp (DAC) stands out as an attractive stock pick for the start of September 2024, especially for those investors eyeing opportunities within the maritime shipping sector. As of the latest update on August 29th, 2024, Danaos Corp boasts a market capitalization of approximately $1.58 billion, marking it as a significant player in the container shipping industry. The company has gained investor interest owing to its robust operational performance and strategic fleet expansion.

Danaos Corp offers a quarterly dividend, currently yielding around 3.9%, providing a tangible return for income-focused investors. The stock’s price-to-earnings (P/E) ratio stands at a conservative 2.8, suggesting potential undervaluation relative to the broader market and shipping sector peers, and indicating a promising upside for investors seeking value prospects.

One of the key financial aspects to consider is Danaos’ current debt levels, which are higher than some of its industry counterparts due to ongoing investments in fleet modernization and expansion. This leverage should be carefully monitored, although the company’s substantial cash flows from long-term charters help mitigate this risk.

Potential investors should also be aware of the volatility typical in the shipping industry, driven by fluctuating freight rates and global economic conditions. Nonetheless, Danaos Corp has a strong track record of navigating these challenges and capitalizing on growth opportunities, positioning it as a compelling investment with both income and appreciation potential.

• InvestingPro health score: 3.23 / 5.00
• InvestingPro average fair value: $96.41 / 15.9% upside
• Fair value confidence: Medium
• Industry: Consumer Discretionary / Household Durables

KB Home (KBH), a prominent US homebuilding company, is a standout pick for investors seeking opportunities in August 2024.

KB Home (KBH) is our final stock pick for September 2024,for investors keen on exploring opportunities within the homebuilding sector. As of August 29th, 2024, KB Home boasts a market capitalization of approximately $6.25 billion, making it a notable player within the industry. This company, renowned for its innovative approach to homebuilding, has consistently focused on affordability and customization, catering to diverse buyer needs and market segments.

KB Home currently offers a dividend yield of approximately 1.2%, making it appealing for income-focused investors. With a P/E ratio of 10.4, the stock appears undervalued compared to its peers, signaling potential for growth and offering a relative sense of security for value investors.

Debt levels for KB Home are moderate, allowing for both ongoing and planned strategic expansions in high-demand markets. The company’s ability to manage its financial obligations while investing in new developments and technology enhancements has positioned it well for future growth.

Investors should note that the homebuilding sector can experience volatility due to factors such as fluctuating interest rates, economic conditions, and changes in housing demand. However, KB Home’s solid financial footing and proactive management approach underpin its resilience and ability to capitalize on market opportunities.

If you’re looking for more great opportunities, here is a list of our top stock picks for previous months during 2024.