Foreign equity markets have lagged the U.S. in recent years, making the valuations of overseas stocks attractive.

Foreign equity markets have trailed the U.S. in recent years, giving stocks overseas attractive valuations compared with those stateside.

So it may be a good time to consider international stocks. In a commentary, Morningstar cited what it called three quality foreign stocks that are undervalued compared with its analysts’ fair-value estimates.

Tencent  (TCEHY) , the giant Chinese Internet group. Morningstar analyst Ivan Su assigns the company a wide moat (durable competitive advantage) and puts fair value for the stock at $90, nearly twice recent trades at $49.

“Tencent delivered an above-expectation bottom line for the third quarter, which was marred by macroeconomic challenges,” he wrote in a commentary.

Revenue was down 2% year over year, but adjusted net income grew 2%, marking a turnaround from four consecutive quarters of declines.

“While the firm’s cost-reduction efforts were the main drivers behind the year-over-year growth in earnings, we see revenue opportunities in areas such as video accounts, international games, and enterprise software,” Su said.

“The market underestimates the longer-term revenue contribution from video accounts and the potential for more operating leverage, as Tencent cements a more efficient cost structure.”

Bayerische Motoren Werke (BMW) Group  (BMWYY) , the German auto titan. Morningstar analyst Richard Hilgert gives the company a narrow moat. He puts fair value for the stock at $50. It recently traded at $33.75, 48% below fair value.

“In addition to being one of the world’s leading premium light-vehicle manufacturers with brands that include BMW and Rolls-Royce, BMW Group also produces motorcycles and provides financial services,” wrote Morningstar investment specialist Susan Dziubinski.

BMW’s narrow moat stems from “the strength of its brand and intellectual property, which allows the company to demand premium pricing across its products,” she said.

“As a result, BMW generates revenue increases above global vehicle growth rates. In fact, despite the chip shortage, supply chain disruptions, and inflationary cost pressures, BMW’s margins last year were solid, thanks in part to strong pricing.”

GSK  (GSK) – Get Free Report, the British drug stalwart. Morningstar analyst Damien Conover assigns the company a wide moat and puts fair value for the stock at $50, 43% above recent trades at $35.10.

“GSK has used its vast resources to create the next generation of health-care treatments,” he wrote in a commentary. The company benefits from an “innovative new-product lineup and expansive list of patent-protected drugs.”

Specifically, “the magnitude of GSK’s reach is evidenced by a product portfolio that spans several therapeutic classes,” Conover said. “The diverse platform insulates the company from problems with any single product.”

In addition, “GSK has developed next-generation drugs in respiratory and HIV areas that should help mitigate both branded and generic competition,” he said. “We expect GSK to be a major competitor in respiratory, HIV, and vaccines over the next decade.”