The low price/earnings ratios of these stocks reflects general investor disinterest probably because of the lack of excitement about these sectors. If you’re a value investor, that kind of thing may be what Warren Buffett was referencing when he said “sell when others are greedy, buy when others are fearful.”
The Shiller p/e of the S&P 500 is up at 40 now, almost touching the high point of the late 1999/2000 dot com bubble. The following stocks show price-earnings ratios of below 20. This is the bargain shelf of the market and the added attraction is that each pays a dividend of greater than 3%.
BHP Group is the Australian mining and metals firm created in its modern form when BHP and Billiton merged in 2001. Iron ore, metallurgical coal, nickel and copper are the most significant 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 key ratios like this at levels so low.
Earnings this year increased by 41.20% and the past 5-year EPS growth rate is 92.20%. Shareholder equity exceeds the amount of long-term debt. The company pays a dividend of $3.12 for an annualized yield of 5.24%. Average daily volume for BHP is about 2.35 million.
Canadian 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 purchased at just 1.76 times its book value. The company’s long-term debt is less than shareholder equity, one sign of financial strength. Earnings per share are off this year by 108%. The EPS increased over the past 5 years by 8.80%.
Investors receive a dividend of $1.47/share. That’s a 3.51% yield. Average daily volume for the stock is 2.98 million, offering plenty of 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 about 2.44 times book.
The price to sales ratio is 2.32 and price to free cash flow comes in at 8.89. These are relatively low figures that generally signify value. Earnings per share this year increased by 310% and the past 5-year EPS growth rate is 35.70%. Shareholder equity is more than twice the amount of long-term debt.
Gold Fields pays a $.36/share dividend for a yield of 3.35%. Average daily volume for the equity traded on the New York Stock Exchange is 5.53 million.
The bank trades with a p/e of 12.42 and at just 1.22 times book value. Earnings per share headed up this year at a 6.80% pace. The past 5-year EPS growth rate is 17.10%.
Valley National pays a dividend of $.44/share for an annualized yield of 3.19%. Average daily volume is 1.70 million shares.
The best read for finding out about analyzing for value stocks is The Intelligent Investor by Benjamin Graham. You’ll want to find the version with the introduction by Jason Zweig for the most updated information on this style of investing.
Not investment advice. For educational purposes only. Always consult with a registered investment advisor before making any decisions.