While a weak dollar may have squashed some overseas travel plans this summer, investors can still enjoy a European vacation by sticking with foreign stocks. It should come as no surprise to market watchers that foreign stocks, boosted by a sinking greenback, have been shredding their American counterparts. The average foreign large-cap growth fund has returned almost 20% annually over the past five years, according to fund tracker Morningstar, compared with a yearly return of 14% for the S&P 500. What may astonish investors, however, is the notion that international stocks are still relatively cheap, despite the huge run-up in share prices. "Even after all this time, European stocks remain significantly undervalued," says Wendell Perkins, portfolio manager for the $115 million ( JFIEX) JohnsonFamily International Value fund, in a video on TheStreet.com TV . "According to our models, they are trading at nearly a 25% discount to U.S. stocks, plus they pay dividends on average of 3%. That's still a great story." Perkins' fund is up 12.5% year to date and has returned an average of 21.5% annually for the past five years. And there is more to the European story in Perkins' view, most notably the ability to increase margins. "As the E.U. has expanded, established European companies have been tapping into low-cost labor in Eastern Europe," says Perkins. "So while their governments may be slow to change, European companies are moving quickly to add shareholder value, because they realize they are now competing in a global marketplace."