I like to focus on stocks that are rated A- or better. Lennar currently falls just short of that because of valuation concerns. I would not be a seller of this stock however, I would just wait for a more opportune time to buy it.

A stock that is very attractively valued and linked to the housing sector is Ocwen Financial ( OCN). This Atlanta, Ga.-based mid-cap stock provides residential and commercial loan servicing, special servicing, and asset management services.

I added this stock to the aggressive growth portfolio in my newsletter back on Aug. 17 of this year. The stock was trading at $24.87 per share back then. Today it is trading at just over $34 per share. I have a 36% gain in the stock so far. Would I buy it today? Absolutely! Here is why . . .

Before I begin, I want to warn you that Ocwen is not for the faint of heart, it is an aggressive growth stock that does not pay a dividend.

Data from Best Stocks Now App

The current valuation on the stock is quite compelling. The stock is trading at just 7.6 times forward earnings with an analysis consensus five-year growth rate of 40% per year. While those growth expectations may be a bit lofty, the stock still has a very miniscule PEG ratio. I have a five-year target price on the stock of $65 per share. This is obviously significantly higher than where the stock trades today.

Data from Best Stocks Now App

The performance of the stock over the years has been stunning!

Data from Best Stocks Now App

Check out how the stock has done vs. the S&P 500 over the last one, three, five and 10 years! Note that it was even up 65.7% in the year 2008. When I compare the performance of Ocwen against the other 3,100 stocks that I follow, it receives a performance grade of A+.

When you combine this performance grade of A+ with a valuation grade of A-, and throw in a dash of safety for good measure, I get an overall grade of A. The stock is currently ranked at number 12 out 3,178 stocks. Look at how it has been ranked over the last several months.

Data from Best Stocks Now App

I never buy a stock without consulting a chart first:

While the stock has come a long way in a short period of time, I like the consolidation currently taking place in shares. To me, this stock has all three legs of the stool in place: valuation, performance and a good chart. In addition to this, everyone has to live somewhere!

At the time of publication, clients of Gunderson Capital Management were long OCN.

Follow my on Twitter, @BillGunderson for any updates on this stock going forward.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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