3 High Return Non-Cyclical Stocks

These stocks may suit the value investor

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Jan 20, 2022
Summary
  • Companhia De Saneamento Basico Do Estado De Sao Pa, Embotelladora Andina SA and uniQure N.V. have earnings yields topping the 20-year high quality market corporate bond spot rate.
  • Greenblatt calculates the earnings yield as the company's earnings before interest and tax divided by its enterprise value.
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Investors may want to consider the following non-cyclical stocks, as their earnings yields (as calculated via

Joel Greenblatt (Trades, Portfolio)'s method) are outperforming the 20-year high-quality market corporate bond spot rate of 3.07% as of the writing of this article.

Greenblatt calculates the earnings yield as the company's earnings before interest and tax (Ebit) divided by its enterprise value. This ratio represents a more reliable reference for the evaluation of non-cyclical stocks, whose earnings have little or no correlation with the business cycle (as the metric only looks at 12 months of business activities).

Companhia De Saneamento Basico Do Estado De Sao Pa

The first stock investors may want to consider is Companhia De Saneamento Basico Do Estado De Sao Pa (

SBS, Financial), a Brazilian provider of treated water, sanitation and liquid waste services.

The stock grants an earnings yield of 11.39% as of the September 2021 quarter. This stands slightly below the median point of the past 10-year historical earnings yield range of 4.25% to 23.82%. The earnings yield ranks higher than 76% of 530 companies that are operating in the utilities-regulated industry.

The share price was trading at around $6.71 in early trading on Thursday for a market capitalization of $4.59 billion and a 52-week range of $5.76 to $8.11.

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Its price-earnings ratio is 9.72 and its price-book ratio is 1.03.

The stock grants a forward dividend yield of 1.19% as of early trading on Jan. 20.

Embotelladora Andina SA

The second stock investors may want to consider is Embotelladora Andina SA (

AKO.B, Financial), a Chilean producer, marketer and distributor of Coca-Cola (KO, Financial) trademark beverages in South America.

The company grants an earnings yield of 12.72% as of the September 2021 quarter. This stands above the median point of the 10-year historical range of 5.27% to 13.95% and ranks higher than 92% of the 102 companies that are operating in the beverages - non-alcoholic industry.

The share price was trading at around $12.80 in early trading on Thursday for a market capitalization of $2.08 billion and a 52-week range of $11.27 to $17.25.

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Its price-earnings ratio is 11.09 and its price-book ratio is 1.38.

The stock grants a forward dividend yield of 7.08% as of early trading on Jan. 20.

uniQure N.V.

The third stock investors may want to consider is uniQure N.V. (

QURE, Financial), an Amsterdam, Netherlands-based biotech developer of treatments for patients suffering from genetic and other diseases.

The company grants an earnings yield of 31.15% as of the September 2021 quarter, standing far above the median point of the 10-year historical range of -473.07% to 90.98% and ranking higher than 94% of 1,492 companies that are operating in the biotechnology industry.

The share price was trading at $19.02 in early trading on Thursday for a market capitalization of $883.39 million and a 52-week range of $18.53 to $40.49.

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Its price-earnings ratio is 2.72 and the price-book ratio is 2.21.

uniQure NV does not pay dividends.

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Disclosures

I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours. Click for the complete disclosure
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