It’s too easy to say that stocks with a low price-to-earnings ratio are cheap but the figure tells you a lot about the valuation of a company on the first view.
Stocks with a low valuation are also rare. For instance, the popular S&P 500 index has only 28 members with a P/E below 10. Around 80 percent of them, in total 23, pay dividends. Current P/Es are great but it’s always good to look at the forward P/E because it uses the future earnings of the company.
Only 16 companies from the S&P 500 have both a current P/E and forward P/E of less than 10. If you buy those stocks you purchase them for a net income yield of 10 percent. That’s a good value in my view if the business is robust and grows with a pace of 5 to 10 percent yearly. You can find a full list of the 15 dividend- paying stocks with a single-digit P/E. Insurance, oil and gas, refining and marketing companies are mostly represented on the screen.
Here are my favorite stocks:
AFLAC (AFL) has a market capitalization of $28.39 billion. The company employs 8,673 people, generates revenue of $25.364 billion and has a net income of $2.866 billion. AFLAC’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $5.747 billion. The EBITDA margin is 22.66 percent (the operating margin is 16.96 percent and the net profit margin 11.30 percent).
Financial Analysis: The total debt represents 3.32 percent of AFLAC’s assets and the total debt in relation to the equity amounts to 27.24 percent. Due to the financial situation, a return on equity of 19.82 percent was realized by AFLAC. Twelve trailing months earnings per share reached a value of $6.33. Last fiscal year, AFLAC paid $1.34 in the form of dividends to shareholders. Forward P/E: 9.34.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 9.62, the P/S ratio is 1.10 and the P/B ratio is finally 1.75. The dividend yield amounts to 2.34 percent and the beta ratio has a value of 1.89.
Phillips 66 (PSX) has a market capitalization of $36.44 billion. The company employs 12,400 people, generates revenue of $182.922 billion and has a net income of $4.131 billion. Phillips 66’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $8.939 billion. The EBITDA margin is 4.89 percent (the operating margin is 3.63 percent and the net profit margin 2.26 percent).
Financial Analysis: The total debt represents 14.51 percent of Phillips 66’s assets and the total debt in relation to the equity amounts to 33.57 percent. Due to the financial situation, a return on equity of 18.72 percent was realized by Phillips 66. Twelve trailing months earnings per share reached a value of $7.71. Last fiscal year, Phillips 66 paid $0.45 in the form of dividends to shareholders. Forward P/E: 8.21.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 7.64, the P/S ratio is 0.20 and the P/B ratio is finally 1.79. The dividend yield amounts to 2.10 percent and the beta ratio is not calculable.
Marathon Petroleum (MPC) has a market capitalization of $22.86 billion. The company employs 25,985 people, generates revenue of $82.492 billion and has a net income of $3.393 billion. Marathon Petroleum’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $6.106 billion. The EBITDA margin is 7.40 percent (the operating margin is 6.48 percent and the net profit margin 4.11 percent).
Financial Analysis: The total debt represents 12.35 percent of Marathon Petroleum’s assets and the total debt in relation to the equity amounts to 28.74 percent. Due to the financial situation, a return on equity of 31.92 percent was realized by Marathon Petroleum. Twelve trailing months earnings per share reached a value of $10.39. Last fiscal year, Marathon Petroleum paid $1.20 in the form of dividends to shareholders. Forward P/E: 7.28.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 6.77, the P/S ratio is 0.28 and the P/B ratio is finally 2.04. The dividend yield amounts to 1.95 percent and the beta ratio is not calculable.
Lincoln National (LNC) has a market capitalization of $11.09 billion. The company employs 8,700 people, generates revenue of $11.532 billion and has a net income of $1.286 billion. Lincoln National’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.865 billion. The EBITDA margin is 16.17 percent (the operating margin is 13.60 percent and the net profit margin 11.15 percent).
Financial Analysis: The total debt represents 2.58 percent of Lincoln National’s assets and the total debt in relation to the equity amounts to 37.66 percent. Due to the financial situation, a return on equity of 9.16 percent was realized by Lincoln National. Twelve trailing months earnings per share reached a value of $4.53. Last fiscal year, Lincoln National paid $0.36 in the form of dividends to shareholders. Forward P/E: 8.28.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 9.13, the P/S ratio is 0.97 and the P/B ratio is finally 0.75. The dividend yield amounts to 1.16 percent and the beta ratio has a value of 2.72.
Take a closer look at the full list of the cheapest stocks from the S&P 500. The average P/E ratio amounts to 8.29 and forward P/E ratio is 8.31. The dividend yield has a value of 2.33 percent. Price to book ratio is 4.39 and price to sales ratio 1.09. The operating margin amounts to 21.46 percent and the beta ratio is 1.72. Stocks from the list have an average debt to equity ratio of 6.53, excluded by Pitney Bowes: 3.02.
Related Stock Ticker Symbols:
PBI, FCX, STX, JPM, SLM, VLO, AFL, PSX, MPC, UNM, TSO, WDC, JOY, LNC, CF
Selected Articles:
· 20 Cheap Large Cap Dividend Challengers With Double-Digit Earnings Growth
· Cheapest Dividend Paying Large Caps As of July 2013
· 20 Cheap Dividend Contenders With Real Low Debt Figures
· Dogs of the Dividend Aristocrats Index
· 19 Cheap Dividend Aristocrats
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Stocks with a low valuation are also rare. For instance, the popular S&P 500 index has only 28 members with a P/E below 10. Around 80 percent of them, in total 23, pay dividends. Current P/Es are great but it’s always good to look at the forward P/E because it uses the future earnings of the company.
Only 16 companies from the S&P 500 have both a current P/E and forward P/E of less than 10. If you buy those stocks you purchase them for a net income yield of 10 percent. That’s a good value in my view if the business is robust and grows with a pace of 5 to 10 percent yearly. You can find a full list of the 15 dividend- paying stocks with a single-digit P/E. Insurance, oil and gas, refining and marketing companies are mostly represented on the screen.
Here are my favorite stocks:
AFLAC (AFL) has a market capitalization of $28.39 billion. The company employs 8,673 people, generates revenue of $25.364 billion and has a net income of $2.866 billion. AFLAC’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $5.747 billion. The EBITDA margin is 22.66 percent (the operating margin is 16.96 percent and the net profit margin 11.30 percent).
Financial Analysis: The total debt represents 3.32 percent of AFLAC’s assets and the total debt in relation to the equity amounts to 27.24 percent. Due to the financial situation, a return on equity of 19.82 percent was realized by AFLAC. Twelve trailing months earnings per share reached a value of $6.33. Last fiscal year, AFLAC paid $1.34 in the form of dividends to shareholders. Forward P/E: 9.34.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 9.62, the P/S ratio is 1.10 and the P/B ratio is finally 1.75. The dividend yield amounts to 2.34 percent and the beta ratio has a value of 1.89.
Phillips 66 (PSX) has a market capitalization of $36.44 billion. The company employs 12,400 people, generates revenue of $182.922 billion and has a net income of $4.131 billion. Phillips 66’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $8.939 billion. The EBITDA margin is 4.89 percent (the operating margin is 3.63 percent and the net profit margin 2.26 percent).
Financial Analysis: The total debt represents 14.51 percent of Phillips 66’s assets and the total debt in relation to the equity amounts to 33.57 percent. Due to the financial situation, a return on equity of 18.72 percent was realized by Phillips 66. Twelve trailing months earnings per share reached a value of $7.71. Last fiscal year, Phillips 66 paid $0.45 in the form of dividends to shareholders. Forward P/E: 8.21.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 7.64, the P/S ratio is 0.20 and the P/B ratio is finally 1.79. The dividend yield amounts to 2.10 percent and the beta ratio is not calculable.
Marathon Petroleum (MPC) has a market capitalization of $22.86 billion. The company employs 25,985 people, generates revenue of $82.492 billion and has a net income of $3.393 billion. Marathon Petroleum’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $6.106 billion. The EBITDA margin is 7.40 percent (the operating margin is 6.48 percent and the net profit margin 4.11 percent).
Financial Analysis: The total debt represents 12.35 percent of Marathon Petroleum’s assets and the total debt in relation to the equity amounts to 28.74 percent. Due to the financial situation, a return on equity of 31.92 percent was realized by Marathon Petroleum. Twelve trailing months earnings per share reached a value of $10.39. Last fiscal year, Marathon Petroleum paid $1.20 in the form of dividends to shareholders. Forward P/E: 7.28.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 6.77, the P/S ratio is 0.28 and the P/B ratio is finally 2.04. The dividend yield amounts to 1.95 percent and the beta ratio is not calculable.
Lincoln National (LNC) has a market capitalization of $11.09 billion. The company employs 8,700 people, generates revenue of $11.532 billion and has a net income of $1.286 billion. Lincoln National’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1.865 billion. The EBITDA margin is 16.17 percent (the operating margin is 13.60 percent and the net profit margin 11.15 percent).
Financial Analysis: The total debt represents 2.58 percent of Lincoln National’s assets and the total debt in relation to the equity amounts to 37.66 percent. Due to the financial situation, a return on equity of 9.16 percent was realized by Lincoln National. Twelve trailing months earnings per share reached a value of $4.53. Last fiscal year, Lincoln National paid $0.36 in the form of dividends to shareholders. Forward P/E: 8.28.
Market Valuation: Here are the price ratios of the company: The P/E ratio is 9.13, the P/S ratio is 0.97 and the P/B ratio is finally 0.75. The dividend yield amounts to 1.16 percent and the beta ratio has a value of 2.72.
Take a closer look at the full list of the cheapest stocks from the S&P 500. The average P/E ratio amounts to 8.29 and forward P/E ratio is 8.31. The dividend yield has a value of 2.33 percent. Price to book ratio is 4.39 and price to sales ratio 1.09. The operating margin amounts to 21.46 percent and the beta ratio is 1.72. Stocks from the list have an average debt to equity ratio of 6.53, excluded by Pitney Bowes: 3.02.
Related Stock Ticker Symbols:
PBI, FCX, STX, JPM, SLM, VLO, AFL, PSX, MPC, UNM, TSO, WDC, JOY, LNC, CF
Selected Articles:
· 20 Cheap Large Cap Dividend Challengers With Double-Digit Earnings Growth
· Cheapest Dividend Paying Large Caps As of July 2013
· 20 Cheap Dividend Contenders With Real Low Debt Figures
· Dogs of the Dividend Aristocrats Index
· 19 Cheap Dividend Aristocrats
Do you like this article? If yes, please support us and hit the button for a Facebook Like, make a tweet or post a comment in the Dividend Yield community! Thank you so much, we really appreciate it.
*If you would like to receive more dividend stock ideas and the free Dividend Weekly, you should subscribe to my free e-mail list. Alternatively, you can follow me onFacebookor Twitter.
