It's all really pretty simple. When we buy stocks, we want to buy them when they're priced below what the underlying company is worth. When looking at the broader market, we similarly want an idea that the stocks in that market are collectively undervalued.

When it comes to the closely-watched S&P 500 index, there's a debate that's been raging over whether investors are better off watching the one-year price-to-earnings ratio or the ratio based on 10-year average earnings -- the cyclically adjusted price-to-earnings ratio, or CAPE -- that Yale economist Robert Shiller favors. And even those that like Shiller's measure can't seem to agree whether today's value should be benchmarked against the long-term average (going back to 1871) or a more recent period, such as the past 20 years.

But I'm going to set aside that debate for a moment and show you five stocks that are almost undeniably cheap. How cheap exactly? Each of the stocks below trades at a multiple of its 10-year average earnings that is below the market's long-term CAPE of 16.4 and is expected to grow at a rate above the market's long-term average of 4%.

Company

Price to Average 10-Year Earnings

Expected Long-Term Growth Rate

Total (NYS: TOT) 7.5 7.5%
Goldman Sachs (NYS: GS) 8.4 10.2%
ArcelorMittal (NYS: MT) 7.3 19.2%
Torchmark (NYS: TMK) 7.9 8.6%
DST Systems (NYS: DST) 6.2 4.2%

Source: Capital IQ, a Standard & Poor's company. Historical average earnings based on calendar years. 2011 estimated based on annualized first half.

For the most part, the names on the list above aren't exactly household names, so we should probably take a closer look at exactly what we're dealing with here.

Energy value: Total
When talk turns to big-cap energy, it generally involves industry giants like ExxonMobil and Chevron. But don't overlook French oil major Total.

The company's financial track record speaks for itself, with a history of solid profits, cash flow, and equity returns. It has a very reasonably-capitalized balance sheet and a very impressive 7% dividend yield. And as far as the business is concerned, there is certainly downside potential if a weak economy causes oil to fall, but at the same time, the world's unquenchable thirst for oil doesn't seem to be drying up any time soon.

I should also point out, though, that this doesn't mean you should completely ignore the other oil majors. With a 10-year average P/E of 11 and an expected growth rate of 7.7%, Exxon could have easily made the list above as well.

Feels so dirty: Goldman Sachs
It's the brokerage house so many investors love to hate. To a large extent, Goldman's business is a hopelessly opaque black box. Almost all of the publicity it's received since the financial crash has been bad publicity. And it wouldn't surprise me in the least to see the company end up on the wrong side of an ethics case study.

That said, as far as the financial world goes, Goldman may actually look like a conservative pick when stacked against the likes of Bank of America (NYS: BAC) or Citigroup (NYS: C) . It still has the brand power to attract top talent, and we can't deny that it's got a heck of a profit-producing track record.

And the stock is darn cheap.

Steeling yourself: ArcelorMittal
Many of the companies on the list above have a reasonable amount of consistency on the bottom line. Not so with ArcelorMittal. The steel business is a highly cyclical one that swings wildly with the leaps and lurches of the global economy. When things are peachy, plenty of building demands plenty of steel. But when growth slows to a crawl, that demand can dry up rather drastically.

In 2008, for example, ArcelorMittal produced a whopping $9.5 billion in net profit. The next year, a mere $157 million. Profits have bounced back since 2009, but they're nowhere near peak levels. The bottom line, though, is that this is the world's leading steel producer, and I think when we consider the company's earnings power, it's pretty obvious that the stock is a ... um ... steal.

Snore-inducing winners: Torchmark and DST Systems
While it wouldn't surprise me to hear that the three names above have hit the radars of many readers, I'd be more surprised to hear that a lot of readers had their eyes on Torchmark and DST. The reason is simple: Both are smaller companies with relatively boring businesses.

The lowdown: $3.7 billion Torchmark is a provider of life insurance and supplemental health insurance, while $2 billion DST provides back-end services for financial and healthcare companies. But just because these aren't the names that everyone is excited about on CNBC hasn't stopped them from being successful. Both companies have solid track records of profitability, cash flow, and equity returns. Both have also returned capital to shareholders through generous share buyback programs.

I don't expect that these companies will suddenly become hot-to-trot Wall Street darlings, but I also don't see them staying at these depressed prices.

Dig in
While I think these are all intriguing ideas, all require more research before making that final "buy" decision. Ready to take the next step in the process? Click the " " next to any of the tickers above to add them to your watchlist. And if none of these catch your fancy? My fellow Fools have put together a free report detailing five stocks that The Motley Fool owns and they think you should own two. Two of the five stocks they highlight would have made the table above. Grab a free copy of that report by clicking here.

At the time this article was published The Motley Fool owns shares of Bank of America and Citigroup. Motley Fool newsletter services have recommended buying shares of Total and Chevron. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.Fool contributor Matt Koppenheffer owns shares of Total, Bank of America, and Chevron, but does not have a financial interest in any of the other companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or Facebook. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.

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