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4 Stocks With High Earnings Returns

These companies' earnings returns more the double the monthly spot rate on 20-year high-quality market corporate bonds

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Nov 17, 2021
Summary
  • Tapestry Inc, Tronox Holdings PLC, Hollysys Automation Technologies Ltd and FedEx Corp could be high-return investments.
  • Wall Street recommends these stocks.
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Looking for stocks whose earnings returns are more than double the monthly spot rate of 20-year high-quality market corporate bonds could provide more opportunities to discover high-return investments. The investment-grade bonds represent corporate loans issued by triple-A, double-A and single-A rated companies.

Since these bonds are offering a monthly spot rate of 3.14% as of the time of writing, the following four stocks could be of interest to investors as their earnings returns are more than 6.3% at price-earnings ratios of less than 15.87.

Tapestry Inc

Shares of Tapestry Inc. (

TPR, Financial) closed at $45.59 on Tuesday for a market capitalization of about $12.54 billion.

The New York-based provider of luxury accessories and branded lifestyle products worldwide offers an earnings return of 6.41% and has a price-earnings ratio of 15.61.

The share price has risen 63% over the past year, determining a 52-week range of $26.78 to $49.66.

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GuruFocus assigned a rating of 5 out of 10 for the company's financial strength and a rating of 7 out of 10 for its profitability.

Wall Street issued a median recommendation rating of overweight with an average target price of $55.74 per share.

Tronox Holdings PLC

Shares of Tronox Holdings PLC (

TROX, Financial) closed at $24.03 on Tuesday for a market capitalization of $3.70 billion.

The Stamford, Connecticut-based global producer of chemicals that are employed in the manufacture of coatings, paints, plastics and paper offers an earnings return of 6.62% and a price-earnings ratio of 15.11.

The stock has risen 103.30% over the past year for a 52-week range of $11.40 to $26.33.

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GuruFocus assigned a rating of 4 out of 10 for the company's financial strength and its profitability.

Wall Street issued a median recommendation rating of overweight with an average target price of $27.56 per share.

Hollysys Automation Technologies Ltd

Shares of Hollysys Automation Technologies Ltd. (

HOLI, Financial) closed at $16.74 on Tuesday for a market capitalization of $1.03 billion.

The Chinese provider of automation and control technologies in China, Southeast Asia and the Middle East offers an earnings return of 6.86% and has a price-earnings ratio of 14.56.

The stock has risen 45.82% over the past year, determining a 52-week range of $11.45 to $21.24.

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GuruFocus assigned a rating of 8 out of 10 for the company's financial strength and a rating of 7 out of 10 for its profitability.

Wall Street issued a median recommendation rating of buy for the stock with an average target price of $21.95 per share.

FedEx Corp

Shares of FedEx Corp (

FDX, Financial) closed at $253.18 on Tuesday for a market capitalization of $67.26 billion.

The Memphis, Tennessee-based global provider of transportation, e-commerce and business services to individuals and companies offers an earnings return of 7.43% and has a price-earnings ratio of 13.45.

The stock has fallen 10.36% over the past year, determining a 52-week range of $216.34 to $319.90.

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GuruFocus assigned a rating of 5 out of 10 for the company's financial strength and a rating of 8 out of 10 for its profitability.

Wall Street issued a median recommendation rating of overweight with an average target price of $301.41 per share.

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