A Trio of Stocks With Low Shiller Price-Earnings Ratios

Value investors could be interested in these companies

Summary
  • Primoris Services, M/I Homes and SkyWest could be value opportunities.
  • Their Shiller price-earnings ratios are below the S&P 500 Index's historical average.
  • The ratio is calculated as the last closing share price divided by the 10-year average inflation-adjusted earnings per share.
  • Wall Street is positive about these stocks.
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Picking stocks with compelling Shiller price-earnings ratios increases the odds of discovering good value opportunities, in my opinion. Thus, investors may want to consider the following stocks since their Shiller price-earnings ratios are below or around the S&P 500 Index's historical average of 16.93 as of the time of writing. The ratio is calculated as the last closing share price divided by the 10-year average inflation-adjusted earnings per share.

Primoris Services

The first company investors may want to consider is Primoris Services Corp. (PRIM, Financial), a Dallas-based engineering and construction services company serving several businesses in North America, including operators in the oil and gas industry and utility companies.

The company has a Shiller price-earnings ratio of 17.79, which is the result of a closing share price of $27.75 on Wednesday and 10-year average inflation-adjusted earnings per share of approximately $1.53 as of the December 2021 quarter. The industry has a median of 15.15 for the ratio.

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The share price has dropped by 19.01% over the past year for a market capitalization of $1.45 billion and a 52-week range of $21.47 to $36.03.

GuruFocus has assigned a score of 6 out of 10 to the company's financial strength and 9 out of 10 to its profitability.

On Wall Street, the stock has a median recommendation rating of overweight with an average target price of $32 per share.

M/I Homes

The second company investors may want to consider is M/I Homes Inc. (MHO, Financial), a Columbus, Ohio-based builder of single-family homes across several states in the U.S.

The company has a Shiller price-earnings ratio of 10.69, which is the result of a share price of $49.38 at close on Wednesday and 10-year average inflation-adjusted earnings per share of about $4.68 as of the December 2021 quarter. The industry has a median ratio of 11.90.

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The share price has dropped by 8.56% over the past year for a market capitalization of $1.43 billion and a 52-week range of $44.02 to $74.85.

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

On Wall Street, the stock has a median recommendation rating of overweight with an average target price of $85.50 per share.

SkyWest

The third company investors may want to consider is SkyWest Inc. (SKYW, Financial), a Saint George, Utah-based regional airline operator in the United States with a fleet consisting of 629 aircraft for scheduled passenger and air freight services. The operator provides approximately 2,080 total daily departures to various destinations in North America, Mexico and the Caribbean.

The company has a Shiller price-earnings ratio of 11.06. The ratio is the result of a closing share price of $27.80 on Wednesday and 10-year average inflation-adjusted earnings per share of $2.53 as of the December 2021 quarter. The industry has a median ratio of 19.21.

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The share price has fallen 52.25% over the past year, determining a market capitalization of $1.41 billion and a 52-week range of $22.78 to $60.675.

GuruFocus has assigned a rating of 4 out of 10 to the company's financial strength and 6 out of 10 to its profitability.

On Wall Street, the stock has a median recommendation rating of overweight with an average target price of $45.20 per share.

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