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Alberto Abaterusso
Alberto Abaterusso
Articles (1478) 

3 Superior Earnings Yield Stocks

Sun Hung Kai Properties Ltd. tops the list

April 08, 2019 | About:

I often screen for companies that are more than doubling 20-year, high-quality corporate bonds' earnings yields. Such research increases the chances of achieving impressive margins.

These bonds represent corporate loans issued by companies that are triple-A, double-A and single-A rated. The Federal Reserve Bank of St. Louis indicated that the monthly average spot rate of the 20-year bonds is 4.43%.

The following stocks have an earnings yield of more than 8.9% as of April 5. Further, these stocks have cheap valuations according to the Peter Lynch chart and high financial strength ratings according to GuruFocus. 

Sun Hung Kai Properties Ltd. ADR (SUHJY) traded around $18.17 per share on Friday for a market capitalization of $52.22 billion. The Hong Kong-based real estate company has an earnings yield of 9.07% versus the industry median of 9.75% and a price-earnings ratio of 11.03 versus the industry median of 10.26.

The price-book ratio is 0.77 compared to the industry median of 0.94, and the price-sales ratio is 4.77 versus the industry median of 2.54.

The share price climbed 11% over the past year. The share price at close Friday fell into the 52-week range of $12.69 to $18.21.

The stock seems to be priced fairly, according to below Peter Lynch chart.

GuruFocus assigned a financial strength rating of 6 out of 10 and a profitability and growth rating of 7 out of 10.

The stock has an overweight recommendation rating and an average target price of $19.51 per share.

Micron Technology, Inc. (NASDAQ:MU) has an earnings yield of 21.55% versus the industry median of 5.12% and a price-earnings ratio of 4.65 compared to the industry median of 19.55.

Shares of the Boise, Idaho-based producer of semiconductor memory were trading around $43.32 on Friday. The market capitalization is roughly $47.94 billion. The stock has fallen 10% for the 52 weeks through April 5. The share price at close Friday was 52.6% above the 52-week low of $28.39 and 49.3% from the 52-week high of $64.66. The stock also has a price-book ratio of 1.44 versus the industry median of 1.85 and a price-sales ratio of 1.71 compared to the industry median of 1.67.

According to the Peter Lynch chart, the stock appears to trade cheaply.

Micron Technology has a GuruFocus financial strength rating of 7 out of 10 and profitability and growth rating of 9 out of 10.

The stock has an overweight recommendation rating and an average target price of $48.67 per share.

Surgutneftegas PJSC ADR (SGTZY) traded around $3.82 on Friday with a market capitalization of approximately $18.64 billion. The Russian oil and gas Integrated company has an earnings yield of 74.6% versus the industry median of 8.08% and a price-earnings ratio of 1.34 compared to the industry median of 12.38.

The stock has a price-book ratio of 0.26 versus the industry median of 1.18, a price-sales ratio of 0.73 versus the industry median of 0.84 and an enterprise value-Ebitda ratio of 1.15 versus the industry median of 6.79.

For the past year through April 5, the share price declined 18%. The share price at close Friday was 5.2% above the 52-week low of $3.63 and 29.6% from the 52-week high of $4.95.

According to the Peter Lynch chart, the stock is undervalued.

GuruFocus has assigned a financial strength rating of 10 out of 10 and a profitability and growth rating of 8 out of 10.

Wall Street issued a hold recommendation rating on shares of Surgutneftegas Public Joint Stock Company.

Disclosure: I have no positions in any securities mentioned.

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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