5 High Yield S&P 500 Stocks for Less Than Book Value

High-yield investing is popular especially in times of low interest rates. A big problem with this strategy is that high-yield stocks often have strange valuations and it is hard to get real bargains. One way to find bargains is to scout for stocks with a market capitalizations below book value. This means if you purchase a part of the company for a dollar, you get more than one dollar in company’s equity. Investors who use this strategy should take a closer look at the accounted values of the company in order to identify asset bubbles. With this thesis in mind, let’s look at the S&P 500 index.


I screened the S&P 500 by stocks with a dividend yield of more than 5%. In addition to the high dividend yield, the market capitalization should be less than the accounted book value of the company. Here are the results sorted by dividend yield.


1. CenturyLink (

CTL, Financial) is acting within the domestic telecom services industry. The company has a market capitalization of $21.5 billion, generates revenues in an amount of $9.6 billion and a net income of $765.2 million. It follows P/E ratio is 14.8 and forward P/E ratio 18.8, P/S 2.3 and P/B ratio 0.97. Dividend Yield: 8.3%.


2. Cincinnati Financial (

CINF, Financial) is acting within the property and casualty insurance industry. The company has a market capitalization of $4.8 billion, generates revenues in an amount of $3.9 billion and a net income of $296.0 million. It follows P/E ratio is 16.1 and forward P/E ratio 19.5, P/S 1.2 and P/B ratio 0.94. Dividend Yield: 5.5%.


3. Hudson City Bancorp (

HCBK, Financial) is acting within the savings and loans industry. The company hasa market capitalization of $3.2 billion, generates revenues in an amount of $2.5 billion and a net loss of $213.9 million. It follows P/E ratio is not calculable and forward P/E ratio amounts to 8.6, P/S 1.3 and P/B ratio 0.66. Dividend Yield: 5.2%.


4. People's United Financial (PBCT) is acting within the savings and loans industry. The company hasa market capitalization of $4.7 billion, generates revenues in an amount of $933.9 million and a net income of $158.3 million. It follows P/E ratio is 27.5 and forward P/E ratio 14.7, P/S 5.0 and P/B ratio 0.82. Dividend Yield: 5.1%.


5. Ameren Corporation (AEE) is acting within the diversified utilities industry. The company hasa market capitalization of $7.7 billion, generates revenues in an amount of $7.7 billion and a net income of $94.0 million. It follows P/E ratio is 84.0 and forward P/E ratio 13.9, P/S 1.0 and P/B ratio 0.99. Dividend Yield: 5.0%.


Take a closer look at the full table of S&P 500 high yields. The average P/E ratio (P/E ratio) amounts to 23.3 while the forward P/E ratio is 15.4. The dividend yield has a value of 6.2%. Price to book ratio is 2.9 and price to sales ratio 2.4. The operating margin amounts to 13.8%.