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5 Undervalued Dividend Plays

Published Tue, 18 Jun 2019 20:23:36 -0400 on Seeking Alpha

Despite increasing signs of a slowing economy, the stock market remains richly valued at ~21.5x earnings. Besides the period of high valuation from the late 1990s to today, driven largely by accommodative monetary policy, there are only a handful of instances - typically brief spikes - when the S&P 500's P/E ratio was higher.
Moreover, this year, defensive stocks such as those in the utility, real estate, and consumer staples sectors have outperformed, driving their yields to unattractively low levels.
Data by YCharts
This has put income-oriented investors with money to invest in a difficult spot. Where can one find stocks that offer above-average yields that are safe and likely to grow in the years ahead?
That is the subject of the present article. Here are five dividend-paying stocks that fit the above description and appear undervalued at this time. For investors hunting for yield, these stocks are attractive prospects for further research:
1. H&R Block (HRB)
HRB helps people with their income tax preparation and paperwork. The company does this mainly through its retail offices but also through its online do-it-yourself program. The company trades at a trailing twelve month P/E ratio of 13.3.
Data by YCharts
The company has a manageable 1.9x long-term debt to EBITDA ratio, and interest expenses are only about 2.4% of revenue and 14.8% of free cash flow. Although last year it was closer to 10% of free cash flow, a drop in free cash flow... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
AT&T 33.26   12.4 2.68 2.04 6.05
H&R BLOCK 28.19   13.6 2.07 1.04 3.72
CVS CAREMARK 56.23   0.0 -0.44 2.00 3.48
FRANKLIN RESOURCES 34.83   11.7 2.97 1.04 2.96
SOUTHWEST AIRLINES 52.30   12.4 4.22 0.72 1.38

AT&T - T
AT&T - T  


Older articles featuring At&t (T):
The Retirees' Dividend Portfolio - John And Jane's June Taxable Account Update: The Danger Of Making Assumptions
A Real Dividend Growth Machine: 2019 Mid-Year Portfolio Review
My Dividend Growth Portfolio: Q2 2019 Summary
Dividend Champion And Contender Highlights: Week Of July 7
Kiplinger Calls These July International Aristocrats The Most Reliable Dividend Stocks On Earth
My Dividend Growth Portfolio Q2 Update: 41 Holdings, 8 Buys, 8 Sells
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Jobs Day, Tesla Deliveries And Dazzling Dividends (Stocks To Watch Podcast)
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