3Com Corp.: Undervalued by Half

3Com (COMS) is a drastically undervalued and oversold stock that should be trading 50% higher than its current price of just $1.97 a share. The company has a healthy $1.25 per share in cash and the stock trades below its book value of $2.49. The forward price to earnings ratio is less than 9, yet the estimated earnings growth rate is estimated to be approximately 33% YOY. These figures have been based on analyst estimates.

Although the company has issued guidance on the lower end of the analysts' range for FY09, it would not be surprising if the actual numbers significantly exceed expectations. The company has beaten analyst estimates the past four quarters by a minimum of 50% each quarter, because management has been quite conservative on its guidance and provided near- flawless execution on its strategies.