What stocks are on sale this week? One method to try to answer this question is to look for stocks that recently started trading below a Price to Earnings (PE) ratio of 12.5. Why 12.5? A PE of 12.5 is the same as an earnings yield of 8%, which provides a decent return given an approximately 3% nominal return on a 5% equity risk premium. That still rather arbitrary, but it is still helpful to draw a line in the sand.
I screen the list of U.S. stocks with a market capitalization of at least $500 million. I then looked for stocks currently trading with a PE below 12.5, but in the previous week had a PE above 12.5 using the Portfolio123 stock screener.
Here’s this week’s list:
|Company||Ticker||PE % change||Current PE including extraordinary items|
|St. Joe Co (The)||JOE||-98.84%||4.46|
|New Jersey Resources Corp||NJR||-66.37%||11.06|
|Global Partners LP||GLP||-65.96%||9.67|
|Voya Financial Inc||VOYA||-45.50%||8.49|
|Marathon Oil Corp||MRO||-32.11%||10.00|
|Realogy Holdings Corp||RLGY||-18.87%||11.69|
|Nu Skin Enterprises Inc.||NUS||-15.61%||12.44|
|TransGlobe Energy Corp||TGA||-15.37%||11.79|
|Navigators Group Inc (The)||NAVG||-13.03%||11.11|
|Abraxas Petroleum Corp.||AXAS||-10.23%||11.87|
|Altisource Residential Corp||RESI||-8.91%||12.21|
|Kelly Services Inc.||KELYA||-8.73%||12.43|
|Brocade Communications Systems Inc||BRCD||-8.35%||11.94|
|Green Plains Renewable Energy Inc||GPRE||-7.66%||12.17|
|Hawaiian Holdings Inc.||HA||-6.10%||11.99|
|CVR Energy Inc||CVI||-4.86%||12.02|
|Walker & Dunlop Inc||WD||-4.23%||12.36|
|Murphy Oil Corp||MUR||-1.98%||12.30|
|Anworth Mortgage Asset Corp||ANH||-1.85%||12.35|
See any interesting value stocks in this list? Share your thoughts in the comments section below. Also, please let me know if you would like to see this list weekly in the future.