4 Undervalued Stocks to Consider as Oil Surpasses $100 a Barrel During US-Iran Conflict

Middle East Tensions and Their Impact on Markets

Ongoing hostilities in the Middle East, particularly between the United States and Iran, continue to keep the region unstable. President Donald Trump has insisted that the conflict will only cease if Iran agrees to surrender without conditions—a stance Iran has firmly opposed. Meanwhile, Iran has been trading attacks with Israel and launching retaliatory strikes on several Gulf nations, heightening regional uncertainty.

This instability has had a profound effect on the global energy sector. The disruption of oil tanker traffic through the vital Strait of Hormuz has pushed crude oil prices above $100 per barrel for the first time in four years. The resulting spike in energy costs has raised fresh worries about inflation and the potential drag on the U.S. economy.

With these developments in mind, investors are paying close attention to the upcoming Consumer Price Index (CPI) report. Elevated geopolitical risks and surging oil prices are expected to fuel ongoing volatility in the stock market.

Value Investing Amid Market Uncertainty

During periods of heightened uncertainty, value investing can offer a measure of stability. By concentrating on businesses with strong financial health, attractive valuations, and reliable cash flows, investors can better weather market turbulence.

While the price-to-earnings (P/E) ratio is a popular tool for spotting undervalued stocks, the earnings yield metric is another valuable indicator. Notable high-earnings-yield stocks currently include Adecoagro S.A., Fortuna Mining Corp., National Energy Services Reunited Corp., and Betterware de Mexico SAPI de CV.

Understanding Earnings Yield

Earnings yield, expressed as a percentage, is calculated by dividing a company's annual earnings per share by its current share price. This figure represents the expected return from a stock’s earnings for each dollar invested.

Stocks with higher earnings yields are typically seen as undervalued, while those with lower yields may be considered expensive. Unlike the P/E ratio, earnings yield allows for direct comparison with fixed-income investments. Investors often compare a stock’s earnings yield to benchmarks like the 10-year Treasury yield to assess whether the stock offers a better return than relatively risk-free bonds.

If a stock’s earnings yield falls below the 10-year Treasury yield, it may be viewed as overpriced relative to bonds. Conversely, a higher earnings yield suggests the stock could be undervalued, making it more attractive to value investors.

How We Select Value Stocks

Our screening process begins with stocks that have an earnings yield above 10%. However, to identify stocks with the potential for strong returns, we also apply these additional criteria:

• Projected EPS growth over the next year at least matching the S&P 500: Compares the forward 12-month EPS estimate to the previous year’s actual EPS.
• Average daily trading volume (20 days) of at least 100,000 shares: Ensures sufficient liquidity.
• Current share price of $5 or higher.
• Buy-rated stocks: Companies with a Zacks Rank #1 (Strong Buy) or #2 (Buy) have historically outperformed in various market conditions.

Top Value Stock Picks

From our screen, here are four standout stocks:

• Adecoagro: This agricultural firm is involved in crop and livestock farming, dairy, sugar, ethanol, energy production, and land development. Consensus estimates for 2026 suggest sales and earnings will rise by 30% and 452%, respectively, year over year. Over the last two months, EPS projections for the current year have increased by $0.43. Adecoagro holds a Zacks Rank #1 and an A Value Score.
• Fortuna Mining: Operating in Argentina, Burkina Faso, Mexico, Peru, and Côte d'Ivoire, Fortuna focuses on mining precious and base metals. Consensus forecasts for 2026 indicate a 180% jump in earnings. EPS estimates for this year have climbed by $0.75 in the past 60 days. Fortuna Mining is rated Zacks Rank #1 with a Value Score of B.
• National Energy: This company provides comprehensive oilfield, drilling, and production services across the Middle East and North Africa. For 2026, sales and earnings are projected to grow by 35% and 94%, respectively. EPS estimates for 2026 have risen by $0.11 over the last two months. National Energy is currently rated Zacks Rank #1 and has a Value Score of B.
• Betterware de México: Specializing in direct-to-consumer sales, mainly in home organization solutions, Betterware is expected to see 2026 sales and earnings increase by 23% and 65%, respectively. EPS projections for 2026 have gone up by $0.62 in the past 60 days. The company holds a Zacks Rank #1 and an A Value Score.

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