As many investors have come to know, finding the right stock at the right is not an easy task, but the recent downturn in the market has created numerous buying opportunities. I have scoured the market and compiled a list of three stocks that are now trading at inexpensive forward valuations compared with their five-year averages, so let’s take a closer look at each to determine which would be the best fit for your portfolio.
1. Macdonald Dettwiler & Associates Ltd.
Macdonald Dettwiler & Associates Ltd. (TSX:MDA) is a global communications and information company, providing operational solutions to commercial and government organizations worldwide. At today’s levels, its stock trades at 12.3 times fiscal 2015’s estimated earnings per share of $6.23 and 11.3 times fiscal 2016’s estimated earnings per share of $6.82, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 22.8. In addition, the company pays a quarterly dividend of $0.37 per share, or $1.48 per share annually, giving its stock a 1.9% yield.
2. Cogeco Cable Inc.
Cogeco Cable Inc. (TSX:CCA) is the 11th-largest cable operator in North America and the second largest in Ontario and Quebec. At current levels, its stock trades at 12.8 times fiscal 2015’s estimated earnings per share of $5.12 and 11.4 times fiscal 2016’s estimated earnings per share of $5.76, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 13. Also, the company pays a quarterly dividend of $0.35 per share, or $1.40 per share annually, which gives its stock a 2.1% yield.
3. Russel Metals Inc.
Russel Metals Inc. (TSX:RUS) is one of the largest metals distribution companies in North America. At today’s levels, its stock trades at 18 times fiscal 2015’s estimated earnings per share of $1.17 and 13.4 times fiscal 2016’s estimated earnings per share of $1.57, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 22. Additionally, the company pays a quarterly dividend of $0.38 per share, or $1.52 per share annually, giving its stock a 7.2% yield.
Could your portfolio use a value stock?
Macdonald Dettwiler & Associates, Cogeco Cable, and Russel Metals are three of the top value plays in their respective industries, and all have the added benefit of dividends. All Foolish investors should take a closer look and consider buying one or more of them today.
