Investors may want to consider the following non-cyclical stocks as their earnings yields (as calculated by Joel Greenblatt (Trades, Portfolio)'s method) are outperforming the 20-year high-quality market corporate bond spot rate of 4.93% as of the time of writing.
Greenblatt calculates the earnings yield as the company's earnings before interest and tax (Ebit) divided by its enterprise value. This ratio represents a more reliable reference for the evaluation of non-cyclical stocks, whose earnings have little to no correlation with the business cycle (as the metric only looks at 12 months of business activities).
CenterPoint Energy Inc.
The first stock investors may want to consider is CenterPoint Energy Inc. (CNP, Financial), a Houston, Texas-based provider of domestic energy.
The stock grants an earnings yield of 5.48% as of the March 2022 quarter. This stands above the middle point of the past 10-year historical earnings yield range of -4.55% to 10.68%. The earnings yield ranks worse than 54.02% of 522 companies that are operating in the utilities - regulated industry.
The stock traded at around $29.56 on Monday, giving it a market cap of $18.61 billion and a 52-week range of $24.32 to $33.
Its price-earnings ratio is 11.64 and its price-book ratio is 2.14.
The stock granted a forward dividend yield of 2.3% as of this writing.
As of July, the stock has a median recommendation rating of overweight with an average target price of $32.56 per share on Wall Street.
United Breweries Co Inc.
The second stock investors may want to consider is United Breweries Co Inc. (CCU, Financial), a Chilean beverage company with activities in Chile, Argentina, Bolivia and Colombia.
The company grants an earnings yield of 12.90% as of the March 2022 quarter. This stands above the midpoint of the 10-year historical range of 4.33% to 15.25% and ranks higher than 89.5% of the 219 companies that are operating in the beverages - alcoholic industry.
The stock traded around $11.27 on Monday, giving it a market cap of $2.08 billion and a 52-week range of $10.90 to $21.82.
Its price-earnings ratio is 9.88 and its price-book ratio is 0.75.
The stock granted a forward dividend yield of 13.74% as of this writing.
As of July, the stock has a median recommendation rating of hold with an average target price of $13.12 per share on Wall Street.
The Kroger Co
The third stock investors may want to consider is The Kroger Co. (KR, Financial), a Cincinnati, Ohio-based grocery store chain accounting for 2,723 retail food shops across 35 states in the U.S. and the District of Columbia.
The company grants an earnings yield of 5.68% as of April 30, standing below the midpoint of the 10-year historical range of 1.18% to 15.37% and ranking better than 53.44% of 305 companies that are operating in the retail - defensive industry.
The stock traded at around $47.53 on Monday, giving it a market cap of $34.01 billion and a 52-week range of $38.22 to $62.78.
Its price-earnings ratio is 1.39 and its price-sales ratio is 0.25.
The stock granted a forward dividend yield of 2.19% as of this writing.
As of July, the stock has a median recommendation rating of hold with an average target price of $55 per share on Wall Street.
