The recent bear market has unveiled some incredible bargains in the market. Call it a stock market white sale.
Most of these companies are in areas that weren’t loved by the bull market, like industrials or financials, but there are also tech companies and even an entertainment giant in the remainder pile.
All the following stocks now sport price-to-earnings multiples under 12, and we’ve carefully picked through those with fat dividends that should be payable out of earnings going forward, for conservative investors of discriminating tastes.
Happy bargain hunting.
Ameriprise Financial (AMP)
Dividend Yield: 3.4%
Ameriprise Financial (NYSE:AMP), the Minneapolis-based asset management company spun-out of American Express (NYSE:AXP) in 2005, was trading at $104 per share on Dec. 27. This came after a drop of 25% in one month, which helped wipe out two years of gains in the stock.
The result, however, may be tempting to bargain hunters. It has a trailing price-to-earnings ratio of just 9.2 despite a 90-cent-per share quarterly dividend yielding 3.4%. The problems with the stock have yet to show up in the financials, with revenue continuing to grow at a slow and steady pace while earnings had already exceeded 2017’s $1.48 billion in three quarters.
The problems at Ameriprise are general throughout the asset management sector. AllianceBernstein (NYSE:AB) is down almost 20% and Franklin Resources (NYSE:BEN) is down 17%. There is an assumption in the market that the next recession will see all such middlemen replaced by computers, but it’s an assumption that has yet to appear in the results.
Ameriprise continues to advertise heavily and recruit new advisors, avoiding headlines, sticking to its knitting. In a defensive market, sticking to your knitting and avoiding the headlines may be a good idea.
Annaly Capital Management (NLY)