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Zacks.com featured highlights include: Avid Technology, Navient, Sykes Enterprises, Lake Gold and Select Medical

Zacks Equity Research

For Immediate Release

Chicago, IL – April 21, 2020 – Stocks in this week’s article are Avid Technology, Inc. AVID, Navient Corp. NAVI, Sykes Enterprises, Inc. SYKE, Kirkland Lake Gold Ltd. KL and Select Medical Holdings Corp. SEM.

5 Stocks with High Earnings Yields to Enhance Your Portfolio

Investors often use P/E ratio and other valuation metrics to pick undervalued stocks with solid upside potential. However, one can also use another interesting ratio, which is simply the inverse of P/E ratio, i.e. earnings yield.

Earnings yield, expressed in percentage, is calculated as (Annual Earnings per Share/Market Price) x 100. While comparing stocks, if other factors are similar, investors can look out for stocks with higher earnings yield. This is because stocks with higher earnings yield have the potential to provide comparatively greater returns.

Amid economic downturn following the coronavirus outbreak, it is prudent to fortify your portfolio for such conditions. Especially in such scenarios, investors are on the lookout for stocks at great values. Firms with higher earnings yield are considered underpriced, while those with lower earnings yield are seen as overpriced.

Earnings yield can be used to compare the performance of a market index with the 10-year Treasury yield. For instance, when the yield of the market index is more than the 10-year Treasury yield, stocks can be considered as undervalued than bonds. In this situation, investing in the stock market would be a better option for a value investor.

However, you need to keep in mind that T-bills are risk free, while investing in stocks always comes with a caveat. Hence, it would be a good idea to add a risk premium to the Treasury yield, while comparing it with the earnings yield of a stock or the overall market.

For the rest of this Screen of the Week article please visit Zacks.com at:https://www.zacks.com/stock/news/880235/5-stocks-with-high-earnings-yield-to-enhance-your-portfolio

Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.

 

 

 

                                                                                     


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Avid Technology, Inc. (AVID) : Free Stock Analysis Report
 
Sykes Enterprises, Incorporated (SYKE) : Free Stock Analysis Report
 
Select Medical Holdings Corporation (SEM) : Free Stock Analysis Report
 
Navient Corporation (NAVI) : Free Stock Analysis Report
 
Kirkland Lake Gold Ltd. (KL) : Free Stock Analysis Report
 
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