10 Potentially Undervalued Stocks to Consider in 2019
Are you looking for an investment strategy to diversify your portfolio? Perhaps you’re a new investor and you’re just getting your feet wet. A good strategy to implement is to invest in undervalued stocks which are likely to show significant growth in the future. A few of the things to look for when using this strategy is to focus on large and stable companies which are listed in the market. You can set your own criteria for those with a market cap of $15 billion minimum fit into the category nicely. Choose those which show growth in earnings per share of at least ten percent, and those with low debt equity ratios. This is the criteria we’ve used to choose the ten best undervalued stocks for investment.
1. Southwest Airlines Co. (LUV)
Southwest Airlines has a market cap of $2 billion. Because of the grounding of the 737 max 8 jet, the stock has taken a dive, even though the growth rate has been excellent over the past five years. There is a trade down of fifteen percent over the last 12 months and it’s an undervalued stock at this point that is highly likely to make a rebound.
2. Sony (SNE)
Sony is another company that meets our criteria as an undervalued stock with a high potential. Sony’s investors are cautious over the projected weakness in sales combined with the shortfall in estimated revenues for the third quarter added to the tension. There has been a lag in camera and smart phone sales, however, when you consider that their play Station 4 has a good potential for increasing in sales, consumers may start buying after the lag for upgrades on their older devices.. A four dollar drop in the price of stock has made some nervous and it’s currently a stock that is undervalued that is worth considering.
3. Eaton Corp (ETN)
This is an industrial stock from a company that is based out of Ireland in the UK. They manufacture power management equipment from residential to industrial supplies. The company has a market capitalization of $33 billion and it experienced a five percent fall for the first two quarters, however, the growth in earnings superseded the expectations in two of the four quarters. The outlook is for a 13 percent EPS growth for this year to carry over with a revenue growth as well. ETN hasn’t missed a beat in paying revenues and it’s currently an undervalued stock that just happens to fall in the dividend category of undervalued stocks.
4. Gilead Sciences, Inc. (GILD)
Gilead Sciences is a stock that is worth a second look as an undervalued stock investment. It’s a dividend stock that has kept up with a 3.1 percent yield with a price over earnings per share of 9.88, which makes it a better bet for performing well in the quarters to come. It’s been given a B+ rating in accordance with the ModernGraham grading system for investment and it shows a high likelihood of increasing in growth over the next decade.
5. Signet Jewelers Ltd. (SIG)
Signet Jewelers Ltd.is an undervalued stock that is recommended for an investor who is not closely adhering to conservative defensive practices. The past decade has shown a weak history of dividend performance, yet it’s been a reliable dividend paying stock with trading above the net asset value of the company with an outlook that moves the trading above the asset value and intrinsic value above the price.
6. Celestica (CLS)
Celestica Celestial saw a decline in net cash of $335 million for the 12 month period with a weak balance sheet. The company is an aerospace and defense equipment supplier with a focus on smart energy, giving reason to believe that it could easily rebound under the right circumstances, especially since the net earnings are on the rise and the earnings price per share is up 44 cents. investors are nervous with the revenue growth and although the stock is undervalued due to a weakness in the semiconductor market there are other products which are still in demand.
7. Fiat Chrysler Automobiles (FCAU).
The auto industry is an up and down niche within the market. Fiat Chrysler Automobiles has a five year history of earnings growth with a percent dividend yield and the PE ratios are as low as they’ve ever been. This is a large cap industrial stock with a somewhat pessimistic outlook that has an unstable and stock price that is down from its 52 week high right now.
8.Tyson Foods (TSN)
Tyson Foods is a company which deals with consumer staples in the food industry. The problems started with the tariff war on China, which buys the largest amount of product from the company. This resulted n a loss of 15 percent in stock value which undervalued the stop. The company currently pays a dividend yield of 2.8 percent. It’s likely that this will be a good stock to invest in an undervalued strategy as it bears the features we look for according to our established model.
9. Prudential Financial (PRU)
Prudential Financial Inc. is undervalued due to changes in its normalized earnings over the past four years. It’s currently trading below its value. It pays dividends with a yield of 3.1 percent and it is considered to be one of the most steady paying dividend stocks on the market.
10. Principal Financial Group Inc (PFG)
Principal Financial Group Inc. is our tenth recommendation for undervalued stock investment. PFG is a dividend stock that pays a yield of 4.1 percent placing it in the same class as PRU as one of the better paying dividend stocks on the market today.