well what is undervalued stock ? we all know but for some who are new it is stock that is selling at a price significantly below what is assumed to be its intrinsic value all depends on the future predictable cash flows of profit.
Some of the common and really good suggestion for picking stocks are
The company's earning history is stable.
The company does not specialize in high-technology that can become obsolete overnight.
The company is not in the middle of some financial scandal.
The company's low PE ratio is not due to profits realized from capital gains.
The company's low PE ratio is not due to a major decline in profitability.
The company's PE ratio is below its average PE ratio for the last 10 years.
The company is selling at a price below its tangible asset value.
The company's trailing 3-years earnings has risen over the past 10 years.
The company's credit rating is AAA, AA, or A.
The company did not have a loss during the last recession.
Wikipedia