The availability of undervalued securities is thinning by the day. Even the recent pullback in the past few weeks hasn't created any significant opportunities. While some sectors and businesses are pushing extreme, many names still exist that look reasonably valued for patient investors. Double-baggers these may not be, but they appear to have the qualities for returns that may exceed average.

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Concentrated Diversity
KBR (NYSE:KBR) is a US company that operates all over the world giving investors great diversity outside the US. This engineering company serves markets that include the energy, utility and infrastructure sectors. Many of the company's clients are government agencies all over the world - customers who have the money to pay. The company recently announced it was opening up a operating center in Angola. And earlier this month, KBR won a infrastructure contract for the Dallas Fort Worth Airport. Despite trading at a 52 week high of $27, shares trade for under 14 times earnings.

KBR was spun off from Halliburton (NYSE:HAL) a few years back. KBR has come under fire in years past for its work with the US government in Iraq. The company was accused of misstating contract billing and other issues. Needless to say, when you deal in the types of areas KBR does, such issues will arise. So far they have not had any material impact on the company's operations.

Providing Security
ManTech International (Nasdaq:MANT) provides technologies and solutions for national security programs in the United States and internationally. Its services include cyber security, systems engineering and other critical tasks needed by our government. The company has an excellent balance sheet and shares trade at under 11 times forward earnings. The market cap is $1.46 billion. The company recently acquired MTCSC Inc., a computer technology company focusing on government agencies, for $75 million in cash. MTCSC is already generating over $80 million in revenues.

Technology equipment company Teradyne (NYSE:TER) may interest the tech-oriented investor. The company sports a market cap of $2.1 billion, over $300 million in net cash and forward P/E of under 9 times earnings. Should the tech sector remain vibrant as it has been recently, Teradyne may be a beneficiary.

Bottom Line
Valuation is part art and part science. Simply looking cheap by statistical standards is obviously a plus, but it's not a guarantee that share price will grow. You need growth in sales and profits to create value. (For related reading, see A Primer On Investing In The Tech Industry.)

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Tickers in this Article: KBR, HAL, MANT, TER

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