U.S. markets closed
  • S&P 500

    3,585.62
    -54.85 (-1.51%)
     
  • Dow 30

    28,725.51
    -500.10 (-1.71%)
     
  • Nasdaq

    10,575.62
    -161.89 (-1.51%)
     
  • Russell 2000

    1,664.72
    -10.21 (-0.61%)
     
  • Crude Oil

    79.74
    -1.49 (-1.83%)
     
  • Gold

    1,668.30
    -0.30 (-0.02%)
     
  • Silver

    19.01
    +0.30 (+1.62%)
     
  • EUR/USD

    0.9801
    -0.0018 (-0.19%)
     
  • 10-Yr Bond

    3.8040
    +0.0570 (+1.52%)
     
  • GBP/USD

    1.1166
    +0.0043 (+0.38%)
     
  • USD/JPY

    144.7290
    +0.2860 (+0.20%)
     
  • BTC-USD

    19,409.94
    +0.88 (+0.00%)
     
  • CMC Crypto 200

    443.49
    +0.06 (+0.01%)
     
  • FTSE 100

    6,893.81
    +12.22 (+0.18%)
     
  • Nikkei 225

    25,937.21
    -484.84 (-1.83%)
     

3 Stocks With Low Forward Price-Earnings Ratios

·3 min read

One strategy to unearth value opportunities is to screen the market for stocks with an enticing forward price-earnings ratio.

Investors may want to consider the following three stocks, as they have a forward price-earnings ratio that stands below the S&P 500 index's historical average of 15. Estimates of future earnings are based on data from Morningstar analysts.


H&R Block Inc

The first stock that meets the criteria is H&R Block Inc (NYSE:HRB), a Kansas City, Missouri-based provider of assisted income tax return, do-it-yourself tax and virtual tax preparation services to the general public in North America and Australia.

H&R Block Inc has a forward price-earnings ratio of 4.25 (versus the industry median of 23.04), which results from Monday's share price of $14.04 and analyst expectations for earnings per share (EPS) of about $3.30 for the next full fiscal year.

The stock price has fallen by 47.4% over the past year, determining a market capitalization of $2.71 billion and a 52-week range of $11.29 to $29.62.

GuruFocus has assigned a moderate rating of 4 out of 10 for the company's financial strength and a very good rating of 7 out of 10 for its profitability.

Wall Street sell-side analysts recommend a hold rating with an average price target of $18.33 per share of H&R Block Inc.

The AES Corp

The second company under consideration is The AES Corp (NYSE:AES), an Arlington, Virginia-based diversified electricity generation and utility operator.

The AES Corp has a forward price-earnings ratio of 10.95 (versus the industry median of 17.83), which is the result of Monday's closing share price of $15.12 and analyst expectations for EPS of approximately $1.38 for the next full fiscal year.

The stock price has decreased by 7.4% over the past year for a market capitalization of $10.05 billion and a 52-week range of $8.11 to $21.23.

GuruFocus assigned a low rating of 3 out of 10 to the company's financial strength and a positive rating of 6 out of 10 to its profitability.

Wall Street sell-side analysts issued a buy recommendation rating with an average target price of $17.75 per share of The AES Corp.

Novartis AG

The third company that meets the criteria is Novartis AG (NYSE:NVS), a Swiss drug giant.

Novartis AG has a forward price-earnings ratio of 14.91 (versus the industry median of 18.96), which derives from Monday's closing share price of $83.65 and analysts' expectations for an EPS of about $5.61 for the next full fiscal year.

The stock price has fallen by almost 8% over the past year for a market capitalization of $194.92 billion and a 52-week range of $69.18 to $99.84.

GuruFocus has assigned a positive rating of 5 out of 10 for the company's financial strength and a very good rating of 7 out of 10 for its profitability.

Wall Street sell-side analysts recommend an overweight rating with an average target price of $102.64 per share of Novartis AG.

Disclosure: I have no positions in any securities mentioned.

Read more here:



Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.

This article first appeared on GuruFocus.