A Trio of Stock Picks With a Low Shiller Price-Earnings Ratio
- By Alberto Abaterusso
Choosing stocks with compelling Shiller price-earnings ratios enhances the likelihood of identifying value opportunities, in my opinion. Thus, investors may want to consider the following stocks, as their Shiller price-earnings ratios are standing below the S&P 500 Index's historical average of 16.78 as of Friday, Jan. 15.
Volkswagen AG
The first company under consideration is Volkswagen AG (VWAGY), a German car manufacturer.
The company has a Shiller price-earnings ratio of 7.05, which is the result of a share price of $20.15 as of Jan. 15 and 10-year average inflation-adjusted earnings per share of $2.86 as of the most recent quarter. The industry has a median of 15.43 for the Shiller price-earnings ratio.
The share price has risen by 1.31% over the past year for a market capitalization of $101.01 billion and a 52-week range of $10.60 to $21.50.
GuruFocus has assigned a score of 3 out of 10 to the company's financial strength rating and of 5 out of 10 to its profitability rating.
As of January, the stock has a median recommendation rating of overweight on Wall Street with an average target price of $87.14 per share.
ORIX Corp
The second company under consideration is ORIX Corp (NYSE:IX), a Japanese provider of a broad range of financial services to clients in Japan and internationally.
The company has a Shiller price-earnings ratio of 10.33. The ratio is the result of a share price of $86.46 as of Jan. 15 and 10-year average inflation-adjusted earnings per share of $8.37 as of the most recent quarter. The industry has a median of 10.16 for the Shiller price-earnings ratio.
The share price has risen by 1.53% over the past year, determining a market capitalization of $21.17 billion and a 52-week range of $52.65 to $89.21.
GuruFocus has assigned a rating of 3 out of 10 to the company's financial strength and 5 out of 10 to its profitability.
As of January, the stock has a median recommendation rating of overweight with an average target price of $44.54 per share.
Teck Resources Ltd
The third company under consideration is Teck Resources Ltd (NYSE:TECK), a Vancouver, Canada-based global industrial metals and mining company.
The company has a Shiller price-earnings ratio of 15.45. The ratio is the result of a share price of $19.63 as of Jan. 15 and 10-year average inflation-adjusted earnings per share of nearly $1.30 as of the most recent quarter. The industry has a median of 23.09 for the Shiller price-earnings ratio.
The share price has risen by 23.77% over the past year, determining a market capitalization of $10.70 billion and a 52-week range of $5.60 to $20.43.
GuruFocus has assigned a rating of 4 out of 10 to the company's financial strength and 7 out of 10 to its profitability.
As of January, the stock has a median recommendation rating of overweight with an average target price of $21.19 per share.
Disclosure: I have no positions in any securities mentioned in this article.
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This article first appeared on GuruFocus.
