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Alberto Abaterusso
Alberto Abaterusso
Articles (1468) 

3 Superior Earnings Yield Stocks

BOS Better Online Solutions tops the list

March 18, 2019 | About:

Investors may want to consider stocks that, as of Friday, are beating 20-year high-quality market corporate bond yields by 100% or more. This increases the chances of discovering a good value stock.

The bonds represent corporate loans issued by triple-A, double-A and single-A rated companies, which means they are unlikely to have financial problems. The most recent monthly observation on the spot rate of the 20-year bond indicates a 4.43% yield.

Thus, since the earnings yield is the inverse of the price-earnings ratio, the following stocks are trading for less than 11.3 times earnings as of Friday.

Further, these companies have a price-book ratio of less than 1 and a high GuruFocus financial strength rating.

The first company is BOS Better Online Solutions Ltd. (NASDAQ:BOSC), an Israel-based provider of radio frequency identification, mobile and supply chain solutions.

Shares were trading around $2.99 at close on Friday for a market capitalization of $10.91. The price-earnings ratio is 10.31 versus an industry median of 24.7, the price-book ratio is 0.92 compared to the industry median of 2.22 and the financial strength rating is 7 out of 10.

The stock has climbed 38% so far this year, outperforming the S&P 500 Index by 25%. The closing price on Friday fell within a 52-week range of $1.9 to $3.99.

The Peter Lynch chart suggests that the stock is not expensive.

The second company is Israel-based G. Willi-Food International Ltd. (NASDAQ:WILC), an international distributor of various food products.

The share price was $7.93 at close on Friday for a market capitalization of $104.99 million. The stock has a price-earnings ratio of 10.86 versus an industry median of 18.85, a price-book ratio of 0.86 versus an industry median of 1.73 and a financial strength rating of 9 out of 10.

The stock has gained 13.4% year to date, outperforming the S&P 500 index by 0.8%. The 52-week range is $6.5 to $8.39.

The Peter Lynch chart suggests the stock is not expensive.

The third company is Tantech Holdings Ltd. (NASDAQ:TANH).

Based in Lishui, China, Tantech Holdings produces bamboo-based charcoal products.

Shares closed at $1.61 on Friday with a market capitalization of roughly $46.21 million. The stock has a price-earnings ratio of 7.67 versus an industry median of 12.82, a price-book ratio of 0.47 versus an industry median of 1.65 and a financial strength rating of 7 out of 10.

So far this year, the stock has declined 7.5%, underperforming the S&P 500 index by 20.1%. The 52-week range of $1.1 to $3.78.

According to the Peter Lynch chart, the stock appears to be cheap.

Disclosure: I have no positions in any securities mentioned.

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About the author:

Alberto Abaterusso
If somebody asks what being a value investor means, Alberto Abaterusso would answer, “The value investor is not just the possessor of the security that represents the company, but he is the owner of that company. As an owner of the company the value investor is actively involved in the dynamics of that company and his first concern is how to have sales progressively growing. Also, the value investor is probably one of the most demanding persons in the world concerning sales.”

Abaterusso is a freelance writer based in The Netherlands. He primarily writes about gold, silver and precious metals mining stocks. His articles have also been widely linked by popular sites, including MarketWatch, Financial Times, 24hGold, Investopedia, Financial.org, CNBS, MSN Money, Zachs, Reuters and others. Alberto holds an MBA from Università degli Studi di Bari (Italy), Aldo Moro.

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