Despite volatility earlier in the year, growth stocks have outperformed their value counterparts in 2025. While the return gap has narrowed, this follows a year when the Morningstar US Growth Index outperformed the Morningstar US Value Index by around 10 percentage points. Value stocks have had more consistent returns so far in 2025, but growth stocks have still managed to come out ahead through the first week of November.
Where do value stocks stand today?
“As the artificial intelligence arms race and buildout boom accelerated this year, Morningstar’s equity research team has incorporated these faster growth rates into its forecasts and increased valuations where warranted. Nowhere have valuations increased as much as in those mega-cap growth stocks that are directly tied to AI,” says Morningstar chief US market strategist Dave Sekera. “Currently, value stocks are undervalued and are attractive on a price to fair value basis whereas growth stocks remain at a modest premium over our valuations.”
We’ve put together a list of the best value stocks to buy for the long term, using these criteria:
- The stocks land in the value portion of the Morningstar Style Box.
- The stocks are from companies included on Morningstar’s list of the Best Companies to Own for 2025. Companies on this list have wide Morningstar Economic Moat Ratings and predictable cash flows, and they are run by management teams that make smart capital-allocation decisions.
- The stocks are cheap, which means they’re trading below Morningstar’s fair value estimates.
10 Best Value Stocks to Invest in for the Long Term
The 10 cheapest value stocks from Morningstar’s Best Companies to Own list as of Nov. 7, 2025, were:
- Campbell’s CPB
- Constellation Brands STZ
- Clorox CLX
- Zimmer Biomet ZBH
- Bristol-Myers Squibb BMY
- Diageo DGE
- Merck MRK
- Danaher DHR
- Mondelez International MDLZ
- GSK GSK
Here’s a little bit about each of these value stocks for the long term. Data is as of Nov. 7, 2025.
Campbell’s
- Price/Fair Value: 0.51
- Morningstar Uncertainty Rating: Medium
- Morningstar Style Box: Small Value
- Morningstar Capital Allocation Rating: Standard
- Industry: Packaged Foods
Campbell’s returns as the most undervalued stock on our list of the best value stocks to buy. The company earns a Morningstar Economic Moat Rating of wide thanks to its cost advantages and brands, which include its namesake brand, Pace, Prego, and Swanson, among others. We think Campbell’s strategy is sound, observes Morningstar director Erin Lash, who expects to see more gains from the company in the future. By leveraging technology, data insights, and artificial intelligence, the company brings products that consumers value to the shelf in a timely fashion. “Campbell’s remains committed to extracting inefficiencies from its supply chain and distribution network, optimizing direct-to-store routes, and investing in automation,” she adds. Campbell recently laid out plans to unlock $375 million in savings through fiscal 2028, on top of the $950 million it realized over the past few years. Campbell stock is trading 49% below our $60 fair value estimate.
Constellation Brands
- Price/Fair Value: 0.58
- Morningstar Uncertainty Rating: Medium
- Morningstar Style Box: Mid-Value
- Morningstar Capital Allocation Rating: Standard
- Industry: Beverages—Brewers
After Campbell’s, Constellation Brands is the second of five consumer defensive companies on our list of best value stocks. The firm is the largest provider of alcoholic beverages across the beer, wine, and spirits categories in the United States, generating 80% of revenue from Mexican beer imports under top-selling brands such as Modelo and Corona. While overall beer volume in the US has been stagnant, Constellation has capitalized on premiumization tailwinds to drive high-single-digit volume growth in past years. Morningstar analyst Dan Su acknowledges some near-term demand challenges as consumers tighten their belts, but Constellation Brands will continue to benefit from consumer loyalty and a solid innovation pipeline. Constellation Brands’ stock trades at a 42% discount to our fair value estimate of $220 per share.
Clorox
- Price/Fair Value: 0.65
- Morningstar Uncertainty Rating: Medium
- Morningstar Style Box: Mid-Value
- Morningstar Capital Allocation Rating: Exemplary
- Industry: Household and Personal Products
Clorox operates in a variety of consumer products categories, from cleaning supplies, to laundry care, to natural personal care products. More than 80% of the company’s sales come from the US. Clorox has been able to navigate intense competition and lower consumer spending by focusing on consumer-centric innovation while bolstering its e-commerce capabilities and marketing efforts. “Clorox remains resolute in investing to support the long-term health of the business and ensure its competitive edge holds,” says Morningstar director Erin Lash. Shares of Clorox stock are 35% undervalued compared with our fair value estimate of $166.
Zimmer Biomet
- Price/Fair Value: 0.68
- Morningstar Uncertainty Rating: Medium
- Morningstar Style Box: Mid-Value
- Morningstar Capital Allocation Rating: Exemplary
- Industry: Medical Devices
Zimmer Biomet is the first of five healthcare companies on our list of best value stocks to buy. The firm is the undisputed king of large-joint reconstruction, says Morningstar senior analyst Debbie Wang, and we expect aging baby boomers and improving technology suitable for younger patients to fuel solid demand for large-joint replacement that should offset price declines. The firm has cultivated close relationships with orthopedic surgeons who make the brand choice. High switching costs and high-touch service lead to strong loyalty to the brand. Zimmer also aims to accelerate growth through innovative products and improved execution. Zimmer Biomet stock trades 32% below our fair value estimate of $130 per share.
Bristol-Myers Squibb
- Price/Fair Value: 0.71
- Morningstar Uncertainty Rating: Medium
- Morningstar Style Box: Large Value
- Morningstar Capital Allocation Rating: Exemplary
- Industry: Drug Manufacturers—General
Adept at partnerships and acquisitions, Bristol-Myers Squibb has built a strong portfolio of drugs and a robust pipeline. The firm has brought in partners to share the development costs and diversify the risks of clinical and regulatory failure, says Morningstar director Karen Andersen. Bristol is aggressively repositioning itself to expand through challenging patent losses. The 2019 Celgene acquisition moved Bristol deeper into blood-related disease, which tends to be an area with strong drug pricing power and should help Bristol in a time when both governments and private payers are pushing back on drug prices. Bristol-Myers Squibb stock is trading 29% below our fair value estimate of $66 per share.
Diageo
- Price/Fair Value: 0.77
- Morningstar Uncertainty Rating: Medium
- Morningstar Style Box: Large Value
- Morningstar Capital Allocation Rating: Standard
- Industry: Beverages—Wineries and Distilleries
Diageo rejoins our list of best value companies to buy now. After a series of mergers and acquisitions, the firm has emerged as a global leader in the spirits industry. “Diageo’s broad presence across categories with both global strategic and local niche brands mitigates the risk to volume from shifting consumer preferences,” says Morningstar analyst Verushka Shetty. Diageo is also focusing on premiumization, which we think will be a long-term tailwind to revenue and margins. Diageo stock trades at a 23% discount to our fair value estimate of $118 per share.
Merck
- Price/Fair Value: 0.78
- Morningstar Uncertainty Rating: Medium
- Morningstar Style Box: Large Value
- Morningstar Capital Allocation Rating: Standard
- Industry: Drug Manufacturers—General
Merck’s combination of a wide lineup of high-margin drugs and a pipeline of new drugs should ensure strong returns on invested capital over the long term, says Morningstar director Karen Andersen. After several years of mixed results, Merck’s research and development productivity is improving as the company shifts more toward areas of unmet medical need. Merck’s new products have mitigated the generic competition, offsetting recent major patent losses. In particular, Keytruda for cancer represents a key blockbuster with multi-billion-dollar potential. We expect Keytruda’s leadership in non-small cell lung cancer and several other cancers will be a key driver of growth for the firm over the next several years, but the 2028 US patent loss on the drug will create eventual pressure. Merck stock is trading 22% below our fair value estimate of $111 per share.
Danaher
- Price/Fair Value: 0.78
- Morningstar Uncertainty Rating: Medium
- Morningstar Style Box: Large Value
- Morningstar Capital Allocation Rating: Exemplary
- Industry: Diagnostics and Research
Medical-technology company Danaher offers differentiated technology that is protected by various intangible assets, including patents, brands, copyrights, and trademarks, says Morningstar senior analyst Julie Utterback. Danaher seeks out attractive markets and makes acquisitions to enter or expand within those fields, and it also divests assets that are no longer core to the business. The company’s acquisition-focused strategy has contributed to it becoming a top-five player in the highly fragmented and relatively sticky life science and diagnostic tool markets. Danaher stock trades at a 22% discount to our fair value estimate of $270 per share.
Mondelez International
- Price/Fair Value: 0.78
- Morningstar Uncertainty Rating: Low
- Morningstar Style Box: Mid-Value
- Morningstar Capital Allocation Rating: Standard
- Industry: Confectioners
Mondelez International is new to our list of best value stocks to buy. The confectioner’s portfolio includes well-known brands like Oreo, Chips Ahoy, Halls, and Cadbury. Mondelez derives around one-third of its revenue from developing markets, more than one-third from Europe, and the remainder from North America. Mondelez targets long-term sales growth of 3%-5% as it seeks to sell its wares across more channels and reinvests in new products aligned with evolving consumer trends at home and abroad. Further, it has prudently acquired niche brands to expand its category and geographic exposure, says Morningstar director Erin Lash, and we anticipate it will continue to pursue inorganic targets when the opportunity arises. Shares of Mondelez stock are trading 22% below our $73 fair value estimate.
GSK
- Price/Fair Value: 0.80
- Morningstar Uncertainty Rating: Medium
- Morningstar Style Box: Large Value
- Morningstar Capital Allocation Rating: Standard
- Industry: Drug Manufacturers—General
Drug manufacturer GSK rounds out our list of best value companies to buy. The firm’s innovative new product lineup and expansive list of patent-protected drugs create a wide economic moat, says Morningstar senior analyst Jay Lee, as GSK’s diverse drug portfolio insulates the company from problems with any one product. The strong product pipeline at GSK stems from a shift in strategy; the firm had previously targeted slight enhancements but now focuses on true innovation. GSK is also strategically branching out from developed markets into emerging markets. We expect GSK to be a major competitor in respiratory, HIV, and vaccines over the next decade. GSK stock trades 20% below our fair value estimate of $58 per share.
What Are Value Stocks?
Simply put, value stocks are stocks that trade below what they’re worth. “Worth” is usually measured by popular valuation yardsticks, such as price/earnings or price/book ratios. Value stocks are often (but not always) found in more established industries with less robust growth prospects. Value stocks also tend to come from mature companies that pay out at least some of their earnings as dividends. In addition, companies that may have solid long-term growth prospects but whose stocks have fallen out of favor for some short-term reason (bad business news, potential regulatory risk, and so on) can become value stocks, too.
What Are the Morningstar Style Box and Fair Value Estimate?
The Morningstar Style Box is a nine-square grid that provides a graphical representation of the investment style of stocks, bonds, or funds. Based on a series of inputs—including a company’s historical and long-term projected growth and its historical and forward-looking price multiples—a stock is classified as either a value stock, a growth stock, or a core stock. A stock is also classified as either small-cap, mid-cap, or large-cap based on its market capitalization.
The fair value estimate, meanwhile, represents what Morningstar analysts think a particular stock is worth. Fair value estimates are rooted in the fundamentals and based on how much cash we think a company can generate in the future, not on fleeting metrics such as recent earnings or current stock price momentum.
How to Find More Cheap Value Stocks to Invest in
Of course, there are many other criteria investors can use to find value stocks to buy for the long term. Here are some tools that investors can use to find more value-stock ideas to research further:
- Investors can use the Morningstar Investor screener to more easily compare value stocks to each other. One way would be to screen by Stock Style under the Criteria drop-down menu, choosing large value, mid-value, small value, or some combination thereof. Then once you have your results, click on Data & Columns to select Financials data points in the Stocks area. These might be valuation metrics like price/earnings ratios or profitability measures like return on assets, among others. Then click Update. Once back to the list of stocks, click on the data point that matters most to you to rank the list on that particular data point.
- Investors who’d rather invest in value stocks through a managed product like an exchange-traded fund or a mutual fund can find ideas to research further in The Best Value Funds.
