A live screening of U.S. equities produced 164 matches under the parameters applied. From that universe, three companies emerged with the largest estimated discounts to their fair values while also meeting basic quality and scale thresholds: positive revenue growth, return on invested capital (ROIC) above 10% and market capitalization exceeding $2 billion.
The shortlist
- Lululemon Athletica (LULU): Trading at $97.70 - Market Cap: $10.81B - P/E: 8.1x - Fair Value Upside: 77.6% - ROIC: 19.7% - Revenue Growth: 1.7%
- Kanzhun (BZ): Trading at $15.11 - Market Cap: $6.72B - P/E: 14.5x - Fair Value Upside: 68.7% - ROIC: 13.9% - Revenue Growth: 12.2%
- EPAM Systems (EPAM): Trading at $119.02 - Market Cap: $6.13B - P/E: 16.0x - Fair Value Upside: 66.5% - ROIC: 13.6% - Revenue Growth: 10.8%
What stands out
Each company brings a different profile to the list. Lululemon is the highest-quality name by the ROIC metric: a 19.7% ROIC points to strong capital efficiency relative to the other two names, even though its reported revenue growth is modest at 1.7%. Kanzhun leads the group on top-line expansion, posting 12.2% revenue growth, which is the fastest pace among the three but implies that future valuation depends on sustaining that growth. EPAM occupies an intermediate position with double-digit revenue growth at 10.8% and a 16.0x price-to-earnings multiple that produces a less extreme valuation gap compared with the other entries.
Interpretation and constraints
The fair-value upside figures cited are outputs from a valuation model and represent estimated gaps between market prices and modelled fair values. These model estimates should not be read as guarantees of future returns. The screening criteria and the metrics shown do not capture a range of execution risks, competitive dynamics, geopolitical exposures or the potential for analyst estimate revisions that could materially affect valuations.
How the names compare
- Lululemon: strongest profitability as measured by ROIC, paired with slower revenue growth.
- Kanzhun: fastest revenue expansion, which underpins its valuation case but increases reliance on sustained growth.
- EPAM Systems: a balanced profile with solid ROIC and double-digit growth that produces a middle-ground valuation picture.
Investors should view this list as a valuation-focused shortlist rather than a ranking of certainty or of overall investment quality. The screen highlights opportunities where current prices appear materially below model fair values given the inputs used, but model outputs depend on assumptions and do not account for all forms of risk.