If Benjamin Graham were alive today, he might be examining the research on this group of stocks. The classic value investor, who wrote Security Analysis and The Intelligent Investor, favored the “below book value” names, especially if the price-earnings ratio seemed reasonable and the company paid dividends.
One advantage to identifying these types of securities is that Wall Street money managers are caught up in hot tech stock fever and have little or no interest in old school valuation methods. That’s a shame because some of these may be likely to outperform over the next few years (no guarantees).
5 Below Book Value Stocks, Dividend-Paying
ASA Gold and Precious Metals (NYSE: ASA)
The stock is up-trending as you can see by the November 2024 crossover of the 200-week moving average by the 50-week moving average (red circled). The major resistance to further gains is the early 2022 high of just above 23.50 where the red dotted line is drawn.
ASA is a South African-based fund now trading at a 2% discount from its book value with a price-earnings ratio of 6.70. Market capitalization is $419 million. Volume is light with an average daily volume of 53,000 shares. The most recent dividend (ex-date of November 13, 2024) came to .18%.
Barclays (NYSE: BCS)
The red circle shows the spot where the 50-week moving average crossed above the 200-week moving average in March 2024. The most recent weekly candlestick is a “bearish engulfing” which suggests the beginning of a pullback — not exactly surprising after such a powerful up move.
Market cap for the UK-based banking firm is $45.69 billion. It trades with a price-earnings ratio of 8.57 at 58% of book value. The debt-to-equity ratio is 2.97. Barclays pays a 3.40% dividend.
Dynex Capital (NYSE: DX)
This one has been trending upward since the late 2023 low of near 8.25. The 50-week moving average crossed above the 200-week moving average in late September 2024 (red circled). The most recent weekly candlestick is a “bearish engulfing” which may indicate the beginning of a pullback.
The real estate investment trust has a market cap of $970 million. It’s a Russell 2000 component. The REIT trades at 94% of book with a price-earnings ratio of 9.73. The debt-to-equity ratio is 5.62. Dynex Capital pays a dividend of 13.07%.
General Motors (NYSE: GM)
The 50-week moving average crossed above the 200-week moving average in late October 2024. Last week’s bearish engulfing candlestick may be the start of corrective move. The stock last year make it as high as 61 — the major resistance is the early 2022 peak of 65.
This S&P 500 component has a market capitalization of $54.81 billion. Shares can be purchased at a 19% discount from book. The price-earnings ratio is 5.32. The debt-to-equity ratio is 1.80. General Motors pays a .98% dividend.
Mizuho Financial Group (NYSE: MFG)
The stock has been up-trending since the October 2022 low of just below 2.20. The 50-week moving average crossed above the 200-week moving average in late July 2023. It peaked in November 2024 at about 5.30.
The Japan-based banking firm has a market cap of $61.24. It trades at 82% of book value with a price-earnings ratio of 11.15. The debt-to-equity ratio is 5.97. Earnings this year are up by 27% and up over the past five years by 40%. Mizuho Financial Group pays a dividend of 3.47%.
Stats courtesy of FinViz.com. Charts courtesy of Stockcharts.com.
More analysis and commentary at johnnavin.substack.com.
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