As many investors have realized, it can be very difficult finding the right stock at the right price when we are ready to buy, but the recent downturn in the market has created a plethora of opportunities. Let’s take a look at three stocks that are now trading at very inexpensive valuations compared with their five-year averages, so you can decide which would be the best fit for your portfolio.
1. TransForce Inc.
TransForce Inc. (TSX:TFI) is one of North America’s largest providers of transportation and logistics services. At today’s levels, its stock trades at 13 times fiscal 2015’s estimated earnings per share of $1.86 and 11.9 times fiscal 2016’s estimated earnings per share of $2.04, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 24.6.
Also, the company pays a quarterly dividend of $0.17 per share, or $0.68 per share annually, giving its stock a 2.8% yield.
2. Constellation Software Inc.
(All figures are in U.S. dollars)
Constellation Software Inc. (TSX:CSU) is one of the world’s leading providers of software and related services to businesses in both the private and public sectors. At current levels, its stock trades at 35.9 times fiscal 2015’s estimated earnings per share of $16.02 and 29.6 times fiscal 2016’s estimated earnings per share of $19.44, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 38.4.
Additionally, the company pays a quarterly dividend of $1.00 per share, or $4.00 per share annually, giving its stock a 0.9% yield.
3. West Fraser Timber Co. Ltd.
West Fraser Timber Co. Ltd. (TSX:WFT) is one of the largest integrated wood products companies in North America. At today’s levels, its stock trades at 19.5 times fiscal 2015’s estimated earnings per share of $2.68 and 10.6 times fiscal 2016’s estimated earnings per share of $4.93, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 76.7. In addition, the company pays a quarterly dividend of $0.07 per share, or $0.28 per share annually, giving its stock a 0.5% yield.
Could your portfolio use a value stock?
TransForce, Constellation Software, and West Fraser Timber are three of the most attractive value plays in their respective industries. Foolish investors should take a closer look and consider initiating positions in one or more of them today.
