Lehman Brothers (NYSE:LEH) may have greater exposure in the debt market than its peers but many analysts believe the bank's 1.4x book value is too pessimistic, especially considering the bank's move to diversify away from its bond holdings. Many others believe, however, that brokerages and banks have yet to hit their lows as the credit and mortgage crisis continues.

Lehman Brothers shares are down more than 30 percent this year in a situation that reminds many of the Russian default that caused major concerns for the bank back in 1998. While this situation isn't nearly as critical, the lesson rings true that shareholders willing to weather the storm may be rewarded handsomely. The recent move down has made LEH the second cheapest major investment bank behind Bear Stearns.

Lehman Brothers continues to have one of the best balance sheets in the industry. While the company's cap structure may have some room for improvement, its price/cash flow, price/book, and price/sales ratios are all extremely strong. The stock also trades at 6x cash flows, which indicates that investors are assigning relatively little value to the company's non-cash assets and earnings potential. Combined, these factors make LEH a stock worth watching!

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