The withering sell-off is starting to fray nerves, and many investors are at the point where they don’t even want to look at their account values. The bottom line is, while a bull market correction like we are seeing is troubling, it was needed, and bear markets rarely start when the economy isn’t in recession. A recent research report from Jefferies highlights the firm’s top new value stock picks, which may be just the ticket for nervous investors.
Jefferies has pinpointed seven top value calls for investors to consider, and we have screened the list for the four that may have the best upside potential based on the current price targets, or that provide the most safety in troubled market waters. All are rated Buy at Jefferies.
American Electric Power
American Electric Power Co. Inc. (NYSE: AEP) is one of the largest electric utilities in the United States, delivering electricity to more than 5.3 million customers in 11 states. The company ranks among the nation’s largest generators of electricity, owning nearly 38,000 megawatts of generating capacity in the United States. It also owns the nation’s largest electricity transmission system, a more than 40,000-mile network that includes more 765 kilovolt extra-high voltage transmission lines, more than all other U.S. transmission systems combined.
Many on Wall Street feel that the stock trades at a discount to its utility peers, and they feel it deserves a premium. They also think the company will sell generating assets and buy back shares with the proceeds, which will be accretive.
American Electric Power shareholders are paid a solid 3.8% dividend. The Jefferies price for the stock is $61. The Thomson/First Call consensus price target is at $60.87. Shares closed on Tuesday at $56.13.
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