As value stocks come back into focus, don't overlook these cheap stocks.
October has been a wake-up call for investors that the stock
market won't go up in a straight line, even if we'd like it to. Earlier this
month, the Dow Jones Industrial Average trudged through its third-largest point
loss in its 122-year history. In the process, it deflated what had been some
very frothy tech-stock valuations.
But lost in the mix is the fact that value stocks -- an
arbitrary term used to describe publicly traded companies that are valued at a
price-to-earnings or PEG ratio well below the broader market and/or their peers
-- continue to get cheaper. That's because Wall Street and investors have
favored growth over value since the end of the Great Recession. However, with
the stock market looking toppy and interest rates clearly on the rise, value
stocks are beginning to come into focus once more.
Spanning the market, five deeply discounted value stocks
stand out. What's a "deeply discounted value stock," you ask? I'd
arbitrarily define it as a company with a forward price-to-earnings ratio of
less than 10 that also happens to be cheaper on a forward P/E basis than it's
been in at least a decade.
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