8 Large-Cap, High-Yield Stocks Below Book Value

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Apr 11, 2012
High-yield stocks, companies with a dividend yield of more than five percent, are often an attractive investment class, especially in times of low short-term interest rates. There are 927 stocks with a yield over five percent available at the markets. In order to find some opportunities, I screened the investment category by stocks with a P/B ratio below one and a market capitalization of more than USD10 billion. If you buy a stock below the book value, you get for a dollar of your cash more than a dollar in assets.


Eight companies remained of which four have a double-digit yield. Four stocks are recommended to buy and two have a strong buy rating. All of the results are from the financial and telecom sector.


Here are my favorite stocks:



1. Telefonica (TEF, Financial) has a market capitalization of $22.90 billion. The company employs 291,027 people, generates revenues of $82,316.34 million and has a net income of $8,104.96 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $26,475.06 million. Because of these figures, the EBITDA margin is 32.16 percent (operating margin 16.02 percent and the net profit margin finally 9.85 percent).


The total debt representing 51.16 percent of the company’s assets and the total debt in relation to the equity amounts to 306.48 percent. Due to the financial situation, a return on equity of 23.45 percent was realized. Twelve trailing months earnings per share reached a value of $4.71. Last fiscal year, the company paid $6.29 in form of dividends to shareholders.


Here are the price ratios of the company: The P/E ratio is 3.19, P/S ratio 0.87 and P/B ratio 0.82. Dividend Yield: 13.73 percent. The beta ratio is 0.97.


2. Annaly Capital Management (NLY, Financial) has a market capitalization of $15.17 billion. The company employs 147 people, generates revenues of $3,579.62 million and has a net income of $343.32 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1,981.85 million. Because of these figures, the EBITDA margin is 55.36 percent (operating margin 11.24 percent and the net profit margin finally 9.59 percent).


The total debt representing 77.94 percent of the company’s assets and the total debt in relation to the equity amounts to 541.02 percent. Due to the financial situation, a return on equity of 2.59 percent was realized. Twelve trailing months earnings per share reached a value of $0.49. Last fiscal year, the company paid $2.44 in form of dividends to shareholders.


Here are the price ratios of the company: The P/E ratio is 31.93, P/S ratio 4.27 and P/B ratio 0.98. Dividend Yield: 13.97 percent. The beta ratio is 0.29.


3. Banco Santander (STD, Financial) has a market capitalization of $58.00 billion. The company employs 193,349 people, generates revenues of $79,721.23 million and has a net income of $8,073.52 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $26,709.55 million. Because of these figures, the EBITDA margin is 33.50 percent (operating margin percent and the net profit margin finally 12.95 percent).


The total debt representing 16.95 percent of the company’s assets and the total debt in relation to the equity amounts to 277.57 percent. Due to the financial situation, a return on equity of 7.10 percent was realized. Twelve trailing months earnings per share reached a value of $0.80. Last fiscal year, the company paid $0.79 in form of dividends to shareholders.


Here are the price ratios of the company: The P/E ratio is 8.09, P/S ratio 1.03 and P/B ratio 0.62. Dividend Yield: 11.70 percent. The beta ratio is 1.72.


Take a closer look at the full table of high yield stocks below book value. The average price to earnings ratio (P/E ratio) amounts to 10.42 and forward P/E ratio is 6.74. The dividend yield has a value of 10.44 percent. Price to book ratio is 0.80 and price to sales ratio 1.56. The operating margin amounts to 15.64 percent.


Related stock ticker symbols:

TEF, NLY, FTE, STD, BBVA, TI, HBC, SLF


Selected Articles:

· 11 High Yield Stocks With Cheap Free Cash Flow Ratios

· 10 High Yield Growth Stocks With Gaining Earnings Momentum

· The Cheapest High Yield Stocks On The S&P 500

· 10 Large Cap High Yields With Single P/E Ratio