8. Invesco: 0.52 Times Book Value
Invesco Ltd. (NYSE: IVZ) offers broad financial services to retail and institutional clients of all sizes, with separately managed accounts, mutual funds and exchange-traded funds, and even alternative markets like commodities and currencies. It has client-focused equity and fixed income portfolios. The firm also launches equity, fixed income, commodity, multi-asset and balanced mutual funds for its clients. It launches equity, fixed income, multi-asset and balanced exchange-traded funds. Despite a low price and a high yield, and earnings being down an expected 40% or so in 2020, Invesco currently is expected to have ample dividend coverage, and earnings are expected to begin increasing close to 10% higher in 2021.
Invesco closed at $11.49 on Monday, in a 52-week range of $6.38 to $19.01. Its market cap is $5.3 billion. The banking company’s current dividend yield is 5.7%. To figure where normalized earnings might go back to in the future, note that the company reported $2.55 in EPS for the 2019 full year, and that would value it at 4.5 times past earnings.
9. People’s United: 0.55 Times Book Value
People’s United Financial Inc. (NASDAQ: PBCT) is nearly 160 years old and is the bank holding company for People’s United Bank. It offers commercial and retail banking and wealth management services through a network of about 450 branches spread around Connecticut, southeastern New York, Massachusetts, Vermont, Maine and New Hampshire. The dividend yield above 7% feels suspiciously high. Still, the payout looks to have enough earnings coverage, even as earnings expected to fall 20% in 2020 and another 13% in 2021.
People’s United Financial closed at $10.23 on Monday. The 52-week trading range is $9.37 to $17.22, and the market cap is $4.3 billion. The banking company also has a current dividend yield of 7.3%. To figure where normalized earnings might go back to in the future, note that the company reported $1.39 in EPS for the 2019 full year, and that would value it at 7.4 times past earnings.
10. Wells Fargo: 0.61 Times Book Value
Wells Fargo & Co. (NYSE: WFC) may be the bank with the most obvious overhang from its account-opening scandals and other operational scandals in recent years. One thing that is also hurting (along with mortgage rates down at record lows) is that Warren Buffett feels no more loyalty at all and has been aggressively selling down his trove of shares. The Berkshire Hathaway stake has continued to shrink since the end of the second quarter’s 237.6 million shares.
Wells Fargo closed at $23.82 on Monday, in a 52-week range of $22.00 to $54.75. It has a market cap of $99.0 billion. It also has a current dividend yield of 1.7%. To figure where normalized earnings might go back to in the future, note that the company reported $4.05 in EPS for the 2019 full year, and that would value it at 5.9 times past earnings.
Loews: A Runner-Up at 0.55 Times Book Value
Loews Corp. (NYSE: L) is listed as a runner-up because its business model is more conglomerate than true financial. On top of its insurance operations, it operates in the oil and gas business, has a chain of more than two dozen hotels and manufactures certain products. Another reason that Loews was featured was due to a rare and perhaps dangerous comment by CEO Jim Tisch that the stock was egregiously undervalued when it reported earnings (losses) at the start of August. Its stock price was between $35 and $36 most of the days after that report, but they were closer to $33.50 last week before the stock market recovery gave a small boost to Loews’ shares.
Loews closed at $34.73 on Monday, in a 52-week range of $27.33 to $56.88. It has a market cap of $9.6 billion. The insurance carrier also has a current dividend yield of 0.7%. To figure where normalized earnings might go back to in the future, note that the company reported $3.07 in EPS for the 2019 full year, and that would value it at 11.4 times past earnings.
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