The roller-coaster market of 2016 has tossed a lot of companies around. We've identified five that have good long-term prospects but have valuations (sometimes due to recent setbacks) that spell good growth potential — and solid dividend yields to cash in on while you wait for their shares to appreciate.
Prices and other data are as of June 8.
Ameriprise
- Symbol: AMPShare price: $101.4452-week range: $76.00 - $130.69Earnings per share: Current year: $9.43, next year: $10.99Price-earnings ratio: 10
- SEE ALSO: 6 Great ETFs for Holding Value Stocks
The firm is transitioning from a life insurer to an investment powerhouse, with more than $800 billion in assets under management. Worries about the impact of the Department of Labor’s new fiduciary rule for advisers have weighed on the stock, but any additional regulatory hurdles won’t impair the business significantly, says Mark Finn, manager of the T. Rowe Price Value fund. The shares sell for 10 times estimated earnings and yield a healthy 3.0%.
Sponsored Content
Apple
- Symbol: AAPLShare price: $98.9452-week range: $89.47 - $132.97Earnings per share: Current year: $8.27 (FY ending September 2016), next year: $9.11 (FY ending September 2017)Price-earnings ratio: 12 (based on estimated earnings for the next four quarters ending March 2017)
You can debate whether the iPhone 7, expected to launch this fall, will be a blockbuster or a dud, but Apple’s stock, down 12% since mid-April, is trading as though the company’s legendary smartphones are facing a long-term decline. Sales of iPhones may not be growing as rapidly as they once did, but demand is more resilient than the stock implies, says Morningstar analyst Brian Colello. Meanwhile, Apple generates tons of cash, which it shares via stock buybacks and a rapidly growing dividend. The stock yields 2.3%.
Sponsored Content
Capital One Financial
- Symbol: COFShare price: $72.1052-week range: $58.49 - $92.10Earnings per share: Current year: $7.54, next year: $8.18Price-earnings ratio: 9
- SEE ALSO: Best Low-Volatility Stocks for the Next Bear Market
Credit cards still supply the bulk of Capital One’s profits, but the company is evolving into a diversified commercial and consumer lender. Loan growth has room to run before credit losses start to accelerate. We’re in the bottom of the third inning when it comes to the credit cycle, says Morgan Stanley. Yet the stock trades at just 9 times estimated year-ahead earnings and yields 2.2%.
Sponsored Content
Ford Motor Co.
- Symbol: FShare price: $13.3652-week range: $10.44 - $15.84Earnings per share: Current year: $2.09, next year: $2.13Price-earnings ratio: 6
A pickup in gasoline prices hasn’t kept buyers away from Ford’s vehicles—April’s U.S. sales were the best in a decade. The country’s second-largest carmaker is keeping a lid on costs, improving economies of scale by building more models on common platforms and pruning the product mix to focus on its Ford and Lincoln brands. The stock yields 4.5%, and S&P Capital IQ sees the annual payout rate of 60 cents a share heading higher.
Sponsored Content
Microsoft
- Symbol: MSFTShare price: $52.0452-week range: $39.72 - $56.85Earnings per share: Current year: $2.66 (FY ending June 2016), next year: $2.89 (FY ending June 2017)Price-earnings ratio: 19 (based on estimated earnings for the next four quarters ending March 2017)
- SEE ALSO: 7 Good Utility Stocks Paying Steady Dividends
Shares of the desktop-software giant took a one-day hit of 7% in April after the company reported disappointing quarterly results. But a shift in focus from a weakening personal-computer market to the company’s rapidly growing cloud business holds promise. “The cloud is a huge opportunity,” says T. Rowe Price’s Finn. Yield is 2.8%.
Sponsored Content
-
The $33,000 Retirement: One Man's Surprising Path to Financial Freedom at 61Forget what society tells you, even with less than $1 million, you can be happy in retirement.
-
The Best Aerospace and Defense ETFs to BuyThe best aerospace and defense ETFs can help investors capitalize on higher government defense spending or hedge against the potential of a large-scale conflict.
-
The 24 Cheapest Places To Retire in the USWhen you're trying to balance a fixed income with an enjoyable retirement, cost of living is a crucial factor to consider.
-
Apple Stock's a Buy Ahead of Apple Event 2024Apple stock is on Wall Street's radar ahead of the tech giant's annual September product event, which begins on Monday. Here's what analysts are saying and what you can expect to see.
-
Warren Buffett Adores Apple as Much as Ever
Berkshire Hathaway trimmed its Apple stake because taxes are "likely" to go up "later."
-
How Inflation, Deflation and Other 'Flations' Impact Your Stock PortfolioThere are five different types of "flations" that not only impact the economy, but also your investment returns. Here's how to adjust your portfolio for each one.
-
How To Avoid Capital Gains TaxesA few small changes in your investing strategy can result in big tax advantages.
-
Why I Still Won't Buy Gold: GlassmanOne reason I won't buy gold is because while stocks rise briskly over time – not every month or year, but certainly every decade – gold does not.
-
Should You Use a 25x4 Portfolio Allocation?The 25x4 portfolio is supposed to be the new 60/40. Should you bite?
-
Retirement Income Funds to Keep Cash Flowing In Your Golden YearsRetirement income funds are designed to generate a reliable cash payout for retirees. Here are a few we like.
