The value of these companies rose over the course of 2019, even if neither their share price gains, nor affordability shot the lights out.

The Morningstar Fair Value Estimate is a share price valuation that reflects our analysts' view on the intrinsic worth of companies within our equity research stable.

This metric doesn't generally move around too often - it was unchanged between 1 January and 31 November for 32 of the 186 companies Morningstar has provided research coverage on for more than a year.

For the following article, I used Morningstar Direct to identify the Morningstar fair value estimate of ASX-listed stocks on given dates at both the start and end of 2019. The latter value was then divided by the former, to give a ratio.

A number above 1 indicates the fair value estimate increased.

On the other hand, even a ratio of one reflects a slight downgrade, because all else being equal, these are revised upward over time due to the time-value of money.

So, if the fair value estimate remains static for an extended period, it usually means Morningstar analysts believe the company's worth has dipped.

The following companies' fair values were the biggest gainers over the course of 2019:

Yet Xero remains overvalued, trading at a 77 per cent premium based on its latest share price of $80.47.

James believes the response of the market to Xero's positive first-half performance in November was over-stated. The share price jumped 10 per cent on 7 November, when management reported strong sales growth driven by a 51 per cent rise in revenues and subscribers in Britain, where Xero now has more than 500,000 customers.

"The first-half result was boosted by particularly strong growth subscriber in Australia, which exceeded our expectations thanks to the Single Touch Payroll rules that require certain businesses to electronically report tax and superannuation information to the ATO," James says.

"However, this strong performance was somewhat offset by a fall in net subscriber additions in the United Kingdom versus the prior period that benefited from the Making Tax Digital reforms.”

But James is buoyed by the strong likelihood Xero will post its first ever profit in fiscal 2020.

Magellan: not immune, but healthier

Another narrow-moat company, fund manager Magellan Financial Group, experienced a 68 jump in its fair value estimate between 1 January and 30 November 2019.

Co-founded by Hamish Douglass, who is also chairman and chief investment officer, Magellan is an Australian-based asset manager of equity and infrastructure funds.

Morningstar equity analyst Chanaka Gunasekera points to a 25 per cent rise in the level of cash investors are placing with the fund in 2019 as the main reason for his lifting the FVE twice – in May and August. This has been prompted largely by uncertainty around Brexit, tariffs on trade between the US and China and also between the US and Mexico.

"We think Magellan has built the foundations for strong future earnings growth from the significant scale it now has in its fund management business," Gunasekera says.

"It’s been able to attract funds by achieving excess returns with lower volatility and drawdowns than most peers."

He also highlights the firm's strong distribution team, which has helped build its strong brand.

Gunasekera acknowledges Magellan isn't immune from the threat passive funds pose to active managers. But he believes it is better positioned to withstand the headwinds than most other Australian active managers.

However, the stock remains overvalued, trading at a 23 per cent premium to its last closing price of $57.79.

Fisher & Paykel: a business of two halves

The fair value estimate of Fisher & Paykel Healthcare Corp increased only slightly less than that of Magellan during 2019. The New Zealand-based medical device and instrument-maker's FVE was lifted 64 per cent to $16.40 between March and the end of November.

Fisher & Paykel Healthcare manufactures, designs and distributes devices for use in respiratory care, acute care and the treatment of sleep apnea.

Morningstar equity analyst Nicolette Quinn describes the company as a "business of two-halves". One is the hospital unit, which contributed about 62 per cent of revenue in the first-half of fiscal 2020. The other is Fisher & Paykel's so-called new applications – primarily its Optiflow nasal high-flow device.

The biggest FVE lift came in May, following a review of the narrow-moat company's risk exposure. Quinn noted the revenue outlook for the company's key hospital division remained intact. She also tipped 20 per cent growth in new applications over five years "in a deeply under-penetrated market".

The company's fair value estimate was lifted again in mid-October to $16.10, after  management flagged a rise in revenue for fiscal 2020.