Donald Yacktman, a famous value investor and patron of the AMG Yacktman Fund (Trades, Portfolio) Class I (YACKX), takes the "forward rate of return" highly into account when he has to assess the attractiveness of a stock. He calculates this valuation ratio as "normalized free cash flow yield plus real growth plus inflation."
The following U.S. listed equities may attract the attention of value investors, as their forward rates of return are more than doubling the return on 20-year high quality market (HQM) corporate bonds, which stands at 3.20% as of the writing of this article.
1-800-Flowers.com Inc
The first stock value investors could be interested in is 1-800-Flowers.com Inc (FLWS, Financial), a Carle Place, New York-based provider of provides floral and fruit arrangement gifts for various occasions in the United States.
1-800-Flowers.com's forward rate of return is 13.16%, which ranks higher than 60% of 703 companies that operate in the retail - cyclical industry.
1-800-Flowers.com' share price gained 112% over the past year to close at $27.08 on Tuesday for a market cap of $1.76 billion. The 52-week range is $11.72 to $39.61. Its price-earnings ratio is 17.36 and its price-book ratio is 3.53.
On Wall Street, the stock has a median recommendation rating of buy and an average target price of $42.71 per share.
Wasatch Advisors Inc is the largest fund holder of the company, holding 7.07% of shares outstanding. The asset management company is followed by BlackRock Inc. with 4.49% of shares outstanding and FMR LLC with 3.34% of shares outstanding.
Farmers National Banc Corp
The second stock value investors should consider is Farmers National Banc Corp (FMNB, Financial), a Canfield, Ohio-based regional bank providing banking and various financial services.
Farmers National Banc Corp's forward rate of return is 19.58%, which ranks higher than 61% of 1,195 companies that operate in the bank industry.
Farmers National Banc Corp's share price has grown nearly 40% over the past year to trade at $15.75 at close on Tuesday for a market cap of $445.80 million and a 52-week range of $9.82 to $18.26. Its price-earnings ratio is 10.71 and its price-book ratio is 1.27.
On Wall Street, the stock has a median recommendation rating of overweight and an average target price of $17.50 per share.
Amid the top fund holders of the company, BlackRock Inc and Vanguard Group Inc are the largest owners with 5.56% and 4.63% of shares outstanding, respectively.
Griffon Corp
The third stock value investors may want to consider is Griffon Corp (GFF, Financial), a New York-based manufacturer and seller of various tools and accessories, including home and building products as well as professional and defense electronics products.
Griffon Corp's forward rate of return is 22%, which ranks higher than 90% of 1,740 companies that operate in the industrial products industry.
Griffon Corp's share price has climbed by nearly 126% over the past year to trade at around $25.04 at close on Tuesday for a market cap of $1.41 billion and a 52-week range of $10.79 to $28.47. Its price-earnings ratio is 16.69 and its price-book ratio is 1.91.
On Wall Street, the stock has a median recommendation rating of buy and an average target price of $30.67 per share.
With 12.32% of shares outstanding, BlackRock Inc. is the leader among the top fund holders of the company. It is followed by Vanguard Group Inc with 8.93% of shares outstanding and Mario Gabelli (Trades, Portfolio) with 7.35% of shares outstanding.
Disclosure: I have no position in any security mentioned.
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