Have these ASX 200 shares now fallen too far to ignore the value?

Value investors aim to generate capital gains by identifying ASX 200 (or smaller) stocks that are trading below their intrinsic value. 

By focusing on companies whose market prices do not fully reflect their underlying fundamentals, value investors seek to purchase assets at a discount and benefit as the market gradually recognises their true worth. 

This approach relies on fundamental analysis, patience, and the belief that market prices can diverge from a company’s intrinsic value in the short term.

Right now, there are two glaring examples amongst ASX 200 stocks that could have fallen far beyond fair value. 

For investors seeking to cash in on quality stocks trading at a value, here are two prime candidates to consider. 

JB Hi Fi Ltd (ASX: JBH)

This ASX 200 stock was making headlines this week when it experienced its worst single day loss on record. 

The retailer delivered record sales, higher profit and a much larger dividend, however investors ran for the hills as its share price tumbled over 12%. 

It seems investors were less concerned with the previous financial year results, and more concerned with slowing growth. 

The team at Morgans is less concerned however. 

In a comment out of the broker this week, it said it expects these headwinds to ease. 

JBH reported a broadly in-line FY26 result, with NPAT up ~3%. However, sales growth slowed in the 4Q, including turning negative in JB Hi-Fi Australia. The July trading update was below market expectations, with 3 out of 4 divisions reporting negative comparable sales growth, and tracking below 1H27 consensus. This was impacted by price increases, supplier stock shortages, weaker consumer backdrop and cycling a strong pcp. We expect some of these headwinds to ease as the year progresses, although the macro trading environment remains choppy.

The broker has a $82 price target on this ASX 200 stock, indicating a 16% upside. 

Harvey Norman Holdings Ltd (ASX: HVN)

Another ASX 200 retailer that presents a strong value play is Harvey Norman. 

It has been hit hard by several headwinds over the last 6 months, including an ASIC enquiry. 

However it may now have been oversold. 

The first attractive aspect of this ASX 200 stock is its dividend yield fetching over 6%. 

Secondly, brokers now see it as a value play with plenty of upside. 

At the time of writing, this ASX 200 stock is trading at roughly $4.60 per share. 

A recent target from Bell Potter of $6 per share indicates an upside potential of 30%. 

While our views on FY27e sees challenging conditions for retailers with a recovery weighted to 2H, on our revised estimates HVN continues to trade at a 1-year forward P/E of ~13x (as per BPe) which appears attractive.

The post Have these ASX 200 shares now fallen too far to ignore the value? appeared first on The Motley Fool Australia.

More reading

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• These ASX 200 shares could generate $10,000 per year in passive income
• Buy, hold, sell: Endeavour, JB Hi-Fi, and New Hope shares 
• Why I’d buy JB Hi-Fi shares today after its big fall

Motley Fool contributor Aaron Bell has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Harvey Norman. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.