A construction materials giant just delivered one of its strongest quarters in years, and the stock barely moved, while a steel producer is growing earnings at over 22% annually at a real discount to cash flow value, and a community bank just integrated a merger that lifted net income 36%.

IT Services

Accenture plc (NYSE: ACN), the global consulting and technology services firm, trades around $127.98 after a sharp selloff tied to weaker growth expectations. Q3 revenue rose 6% to $18.72 billion, diluted EPS increased 9% to $3.80, operating margin expanded 20 basis points to 17.0%, and free cash flow reached $3.6 billion. The numbers were not broken. The reaction came from the outlook.

New bookings slipped to $19.3 billion from $19.7 billion a year earlier, while full-year local-currency revenue growth guidance narrowed to 3% to 4% from the prior 3% to 5% range. Consulting demand remains soft, federal work remains an overhang, and investors are questioning how AI will change the traditional services model.

At this price, you get a global IT services leader, valued as if slower bookings have already rewritten the whole earnings story.

Soft Bookings Are the Real Pressure Point 

A booking miss matters because service companies live on pipeline confidence. When clients delay discretionary work, the market does not wait for revenue to weaken before cutting the multiple.

$3.6 Billion in Free Cash Flow Softens the Selloff 

The sell-off looks harsh because Accenture is still generating cash, expanding margins, and returning capital, even as the cycle remains uncomfortable. A near-10x earnings multiple does not remove the demand risk, but it does make the stock harder to dismiss if bookings stabilize and AI work starts turning into larger revenue.

Retail

The Kroger Co. (NYSE: KR), the U.S. grocery retailer, trades around $56.61 after a sharp post-earnings selloff. Q1 revenue came in at $46.12 billion, ahead of the $45.47 billion estimate, while adjusted EPS landed at $1.58, just below the $1.59 estimate. The company kept full-year guidance in place, including 1% to 2% identical sales growth excluding fuel and adjusted EPS of $5.10 to $5.30.

The problem is not that shoppers stopped buying groceries. It is that they are buying more carefully. Gross margin slipped to 22.7% from 23.0% a year ago, and management warned that inflationary pressures are likely to build in the second half. That is enough to make the market nervous, even with sales holding up.

At this price, you get an essential retail business valued like margin pressure has already taken control of the story.

Selective Shoppers Put Margins Back in Focus 

A grocery chain can grow sales and still disappoint if costs rise faster than the basket. Kroger now has to prove its price cuts, private-label strength, and cost savings can protect traffic without crushing profitability.

Near 11x Forward Earnings Leaves Room for Relief 

Near 11x forward earnings, Kroger is not priced like a flawless defensive retailer. That is the point. If consumers remain selective but the company maintains guidance, the sell-off may be pricing in more margin damage than the current numbers actually show.

Energy Services

SLB Ltd. (NYSE: SLB) trades around $48.09, against a $60.83 consensus price target, putting the stock about 21% below the Street’s average mark. It is not a bargain-bin multiple at roughly 21x earnings, but the market is still pricing SLB as a cyclical oilfield services name, even as management tries to make digital harder to ignore.

Fresh detail came from the company’s Digital Investor Day, where SLB laid out a path to nearly $2 billion in annual digital revenue by 2030. Digital adjusted EBITDA is targeted at $1.8 billion to $2 billion, with margins expanding toward 38% to 42%, well above what investors typically expect in a traditional services cycle.

A fresh price-target raise to $64 adds the catalyst. The cleaner setup for you is not just oilfield activity. It is a higher-margin digital business carrying more of the re-rating argument.

Digital Targets Make the Mix Shift Harder to Ignore

A digital business with 38%-42% margins gives SLB a growth story that extends beyond drilling cycles. If adoption keeps rising, the multiple deserves more credit than a plain services label gives it.

A 21% Target Gap Leaves Room for a Re-Rating

SLB does not need perfection to work from here. Trading below consensus and below a fresh $64 target, it only needs the digital story to look credible enough for the market to stop valuing it like yesterday’s oilfield cycle.

Northpointe Bancshares (NASDAQ: NPB) is a mortgage warehouse and retail banking name that just posted Q1 2026 net interest income of $41.27 million, up from $30.39 million a year earlier, a jump that is hard to ignore on a small-cap balance sheet. 

Earnings are projected to grow 15.89% annually, and insiders have been increasing their share purchases over recent months, which is the kind of signal that tends to matter more than analyst notes on a name this size. The allowance for bad loans sits at a relatively low 11%, suggesting the loan book quality has not deteriorated even as the balance sheet has grown. 

This is a smaller, less-followed name where the fundamentals are doing the talking before the broader market catches on. The risk is that mortgage warehouse lending is inherently cyclical, and a slowdown in housing activity would hit this revenue line faster than a more diversified bank.

Midland States Bancorp (NASDAQ: MSBI) delivered a genuine turnaround in Q1 2026, posting net income of $18.46 million against a loss in the year-ago period, while completing $17.43 million in share repurchases covering 822,729 shares. 

Earnings are projected to grow 42% annually going forward, one of the more aggressive growth forecasts among regional banks this size, and the recent addition of Claire Stack as CFO adds fresh leadership depth to the executive team. Insider confidence showed up directly with Travis Franklin purchasing 9,400 shares for roughly $249,000. 

A swing from loss to meaningful profit in a single year, combined with an active buyback and a 42% growth forecast, is not a setup that typically stays quiet for long. The risk is that the turnaround proves to be a one-quarter event rather than a sustained trend, particularly if credit costs normalize higher from currently favorable levels.

Investar Holding (NASDAQ: ISTR) is a Louisiana-based bank holding company forecasting 28.58% annual earnings growth after posting Q1 2026 net interest income of $32.66 million, nearly double the $18.35 million from a year earlier. 

Insiders purchased $1.53 million worth of shares between January and March 2026, and the company has been actively executing share buybacks alongside that growth. Past shareholder dilution is a fair point of caution, but the operational trajectory here, nearly doubling net interest income year over year, is the kind of number that tends to draw attention once a couple more quarters confirm the trend is durable rather than a one-off. 

The risk is that the dilution history signals a pattern of raising capital that could recur and offset some of the per-share earnings growth investors are underwriting.

That's our coverage for today; thanks for reading! Reply to this email with feedback or any [blank] stocks you want me to check out.

Best Regards,
—Noah Zelvis
Undervalued Edge