Bank of America and 2 other value stocks that are now more than 20% off

In addition to the growth stocks, which are suffering the most from the current declines, the price of the latter, i.e. value stocks, is also falling. Many of them are now getting to interesting valuations that we have not seen for a long time. What three particular stocks are now at more than a 20% discount and why are they worth paying attention to?

It may be that it is not 100% clear to some what a value stock actually means. These are stocks that are trading at a lower price than the company's performance would otherwise suggest. Investors in value stocks seek to take advantage of inefficiencies in the market because the price of the underlying stock may not match the performance of the company. These stocks should have a low P/E, pay dividends, and have a low price-to-book value (P/B) ratio. That would be a start, now let's move on to specific stocks.

1. Bank of America $BAC

This bank is one of the largest financial institutions in the world. It belongs to the big four along with Citigroup, JPMorgan Chase and Wells Fargo. It operates in a total of 4 segments, namely Consumer Banking, Global Wealth & Investment Management, Global Banking and Global Markets. Consumer Banking provides the classic services that we know from Czech banks, i.e. savings accounts, current accounts, mortgages, and consumer loans, for example. Global Wealth & Investment Management offers investment and brokerage products and services, as well as pension insurance. Global Banking deals with leasing or, for example, underwriting and advisory services. The last segment, Global Markets, handles currency or commodity derivatives.

Source.

BAC shares have fallen nearly 25% since the beginning of the year and are now trading at $34.8. However, it's still quite far from the yearly low of $29.67. The current price gives the company a PE ratio of 10.85, which is still quite acceptable for a value stock. The company pays a dividend of $0.22 per share, which implies a 2.53% dividend yield. Dividend investors will be interested to know that the company has been able to increase its dividend regularly. In addition, the company is also fulfilling its buyback programs, as we can see in the illustrative screen below.

Reduction in the number of shares outstanding since 2014, source: koyfin

Given the nature of BAC's business, it's worth mentioning the Fed's interest rate hikes. They are now at 2.5% and it is likely that these will rise again. But what do interest rates actually mean for banks? As interest rates rise, the profitability of the banking sector increases. Institutions in the banking sector, such as retail banks, commercial banks, investment banks, insurance companies and brokerage firms, have huge cash reserves thanks to client balances and trading activities. And given the BAC's wide reach, it has benefited and may yet benefit.

2. Intel $INTC

The company is engaged in the design, manufacture and sale of computer products and technology worldwide. It offers platform products, such as CPUs and chipsets and system and multi-chip packages, and non-platform or adjacent products, including accelerators, boards and systems, connectivity products, graphics, and memory and storage products.

Source.

If we had to point to anyone who is dealing the worst with the current downturn in the semiconductor sector, Intel would be one of the first to take a hit. It blamed its worse quarterly results on supply chain issues, covid restrictions in China, as well as its own internal troubles. The stock now trades at $29.36, down 44.82% YTD. This puts the company at a PE ratio of 6.29, clearly the lowest valuation in the semiconductor industry. The current price, which hasn't been lower in 5 years, also causes a decent 6.29% dividend yield. The payout is regularly increased and most recently shareholders received $0.365 per share.

3. Verizon Communications $VZ

Verizon Communications Inc. through its subsidiaries offers communications, technology, information and entertainment products and services to consumers, businesses and government entities worldwide. Its Consumer segment provides postpaid and prepaid service plans, Internet access on laptops and tablets, wireless devices, including smartphones and other handsets, and wireless Internet-enabled devices, such as tablets and other connected devices with wireless connectivity, including smartwatches. It also provides fixed connectivity solutions for the home, such as Internet, video and voice services, and sells network access to mobile virtual network operators.

The biggest competitor can be considered AT&T, with which I will also make a small comparison. AT&T will be on the left and Verizon on the right. Bold indicates what comes out as the better value. LTM (last twelve months) data I drew from Koyfin.

  • Price/earnings - 6.13 X 8.18
  • Price/book - 1 X 2
  • Dividend yield - 6 .67% X 6.41%
  • Payout ratio - 66.9% X 51.08%
  • Net Margin - 12.73% X 15.48%
Source.

Verizon shares are now trading at $40.76, down 22% from the beginning of the year. The current price is the lowest since 2012. That's already a really decent decline, which of course could still continue given the stock market's fall.

Summary

Of today's picks, I only own a few shares of Verizon, which I may be adding to within a few months. But I think they are all interesting companies. Bank of America impresses me the most, then Verizon, even though it has a lot of debt, which I must mention. Intel is going through a bit of a downturn, but that is in all semiconductor companies to some degree.

Do you own any of the stocks mentioned? Have you not resisted the discount, are you waiting, or have you given more growth stocks a chance? 🤔

Read the full article for free?
Go ahead 👇

Do you have an account? Then log in . Or create a new one .

desxdfh

how am I good at trading, stocks, choosing a classy broker

Please help me

Another thing is that while searching for a good internet electronics shop look for online shops that are frequently updated trying to keep uptodate with the most uptodate products the best deals in addition to helpful information on services This will ensure you are doing business with a shop that stays atop the competition and offers you things to make knowledgeable wellinformed electronics acquisitions Thanks for the crucial tips I have really learned from your blog
Please note that this is not financial advice Every investment must go through a thorough analysis
Bitcoin is pseudonymous meaning that funds are not tied to real-world entities but rather bitcoin addresses Owners of bitcoin addresses are not explicitly identified but all transactions on the blockchain are public In addition transactions can be linked to individuals and companies through idioms of use e g transactions that spend coins from multiple inputs indicate that the inputs may have a common owner and corroborating public transaction data with known information on owners of certain addresses 65 Additionally bitcoin exchanges where bitcoins are traded for traditional currencies may be required by law to collect personal information 66 To heighten financial privacy a new bitcoin address can be generated for each transaction
Social trading is a form of investing that allows investors to observe the trading behavior of their peers and expert traders The primary objective is to follow their investment strategies using copy trading or mirror trading Social trading requires little or no knowledge about financial markets 1
A wallet stores the information necessary to transact bitcoins While wallets are often described as a place to hold70 or store bitcoins due to the nature of the system bitcoins are inseparable from the blockchain transaction ledger A wallet is more correctly defined as something that stores the digital credentials for your bitcoin holdings and allows one to access and spend them 7 ch 1 glossary  Bitcoin uses public-key cryptography in which two cryptographic keys one public and one private are generated 71 At its most basic a wallet is a collection of these keys
Trade involves the transfer of goods and services from one person or entity to another often in exchange for money Economists refer to a system or network that allows trade as a market An early form of trade barter saw the direct exchange of goods and services for other goods and services 1 i e trading things without the use of money 1 Modern traders generally negotiate through a medium of exchange such as money As a result buying can be separated from selling or earning The invention of money and letter of credit paper money and non-physical money greatly simplified and promoted trade Trade between two traders is called bilateral trade while trade involving more than two traders is called multilateral trade
Just desire to say your article is as surprising The clearness in your post is simply spectacular and i could assume you are an expert on this subject Well with your permission let me to grab your feed to keep up to date with forthcoming post Thanks a million and please continue the gratifying work
Professional day tradersthose who trade for a living rather than as a hobbyare typically well established in the field2 They usually have indepth knowledge of the marketplace too Here are some of the prerequisites required to be a successful day trade
Don't have an account? Join us

Log in to Bulios


Sign.popup.orUseEmailAndPassword
Už jsi členem? Přihlásit se

Create Bulios profile

Continue with

Sign.popup.orUseEmailAndPassword
You can use lowercase letters, numbers, and underscores

Why Bulios?

One of the fastest growing investor communities in Europe

Comprehensive data and information on thousands of stocks from around the world

Current information from global markets and individual companies

sign.popup.registration.listWhy.fourth

Fair prices, portfolio tracker, stock screener and other tools

Timeline Tracker Overview