The low price/earnings ratio of these stocks reflects general investor apathy, perhaps due to a lack of enthusiasm about these sectors. If you’re a value investor, that sort of thing might happen when Warren Buffett said “Sell when others are greedy, sell when others are fearful.”
S&P 500 . of Schiller P/E Now at 40, almost touching the high point of the dot com bubble of late 1999/2000. The following stocks show a price-earnings ratio below 20. This is a bargain shelf of the market and the added attraction is that each pays a dividend of over 3%.
BHP Group is an Australian mining and metals firm formed in its modern form after the merger of BHP and Billiton in 2001. Iron ore, metallurgical coal, nickel and copper are the most important products found by the company.
The market capitalization is $148,280 billion and the enterprise value is $153,700 billion. BHP trades with a price-earnings ratio of 13.36. The price to free cash flow ratio is 7.94. You’re unlikely to find too many tech stocks with such key ratios at such a low level.
Earnings grew by 41.20% this year and last 5 years EPS growth rate was 92.20%. Shareholder equity exceeds the amount of long-term debt. The company pays a dividend of $3.12 for an annual yield of 5.24%. The average daily volume of BHP is about 2.35 million.
Canada’s Natural Resources is an oil and gas exploration and production company in business since 1989 with headquarters in Calgary, Alberta. With a market capitalization of $48.20 billion and an enterprise value of $61.62 billion, the stock trades with a price-earnings ratio of 10.85.
Canadian Natural Resources can be bought for just 1.76 times its book value. The company’s long-term debt is less than shareholder equity, an indication of financial strength. Earnings per share declined by 108 per cent this year. The EPS has grown by 8.80% in the last 5 years.
Investors get a dividend of $1.47/share. This is a 3.51% yield. The average daily volume for the stock is 2.98 million, which provides ample liquidity for large institutional investors.
Gold Fields Limited is a South African-based precious metals mining company with a market capitalization of $9.66 billion and an enterprise value of $10.73 billion. With a price-earnings ratio of 11.02, the stock now trades at around 2.44 times book.
The price to sales ratio is 2.32 and the cost to free cash flow comes out to 8.89. These are relatively small figures that generally reflect value. Earnings per share grew by 310% this year and last 5 years EPS growth rate is 35.70%. Shareholder equity is more than twice the amount of the long-term debt.
Gold Fields pays a $.36/share dividend for a 3.35% return. The average daily volume for equities traded on the New York Stock Exchange is 5.53 million.
The bank trades at an AP/E of 12.42 and only 1.22 times the book value. Earnings per share grew this year at a pace of 6.80%. The EPS growth rate for the last 5 years is 17.10%.
Valley National pays a dividend of $.44/share for an annual yield of 3.19%. Average daily volume is 1.70 million shares.
The best read to learn about analyzing value stocks is The Wise Investor by Benjamin Graham. For the most up-to-date information on this style of investing, you may want to search for the version with the introduction to Jason Zweig.
Not investment advice. For educational purposes only. Always consult a registered investment advisor before taking any decision.