Selected using techniques derived from the works of Benjamin Graham, these basic value stocks are trading below book value and pay dividends. Such equities are for those taking a long-term approach to investing without too much regard for the daily ups and downs.
Since it is value at the heart of the process, the trend of moving averages is not considered all that relevant, though others may disagree. These are not recommendations, simply ideas for those who wish to conduct further research.
ARC Document Solutions
First up is ARC Document Solutions Inc. (ARC, Financial), a document images and graphic productions services business with corporate headquarters in San Ramon, California. The company has 140 print center locations throughout the country.
The market capitalization for ARC comes to $148 million. The stock is trading with a price-earnings ratio of 11.75 and at a 13% discount from its book value. The 2022 earnings per share increased by 48.70% and the past five-year growth rate is 17.10%. Shareholder equity exceeds long-term debt and the current ratio sits at 1.50. Average daily volume is light for a New York Stock Exchange-listed security with 136,000 shares traded. Institutions own slighly over 50% of the total float. ARC is paying a 6.35% dividend.
Avnet
Avnet Inc. (AVT, Financial) is a technology company with a focus on the distribution of computer and electronics materials. Based in Phoenix, the business supplies a wide range of products, including cables and wires, embedded boards and systems, peripherals and a number of other tech-related items.
Earnings per share for last year grew by 259% and for the past five years increased by 27%. The stock trades with a price-earnings ratio of 5 and at 94% of book value. The market capitalization is presently $858 million. The amount of long-term debt is less than shareholder equity and the current ratio is 2.50. Average daily volume is 605,000 shares. Avnet pays a dividend yield of 2.54%.
Buenaventura
Buenaventura Mining Co. Inc. (BVN, Financial) is Peruvian precious metals company focused on the exploration, development and operation of mines. It has been in business for 69 years and began trading on the New York Stock Exchange in 1996.
The market capitalization comes to $1.98 billion. Buenaventura trades at 37% discount from its book value with a price-earnings ratio of 8.68. 2022 earnings per share showed growth of 187%. The past five-year EPS increased by 19.20%. Shareholder equity significantly exceeds the company's long-term debt. The stock is actively traded with an average daily volume of 1.20 million shares. Buenaventura pays a dividend yield of 0.99%.
Gerdau
Gerdau S. A. (GGB, Financial) is, according to its website, "the leading producer of long steel in America and one of the world's largest suppliers of special steel." With headquarters in Brazil, the company has metal manufacturing locations in 10 countries.
The market capitalization for the stock is $8.73 billion. Trading now with a price-earnings ratio of 3.44, Gerdau is priced at a 5% discount to its book value. The price-to-free cash flow metric is 5.80. Earnings per share for 2022 came to an increase of 553% and the growth rate over the past five years is 49.10%. Wall Street analysts are not expecting that kind of growth to continue at such levels. Earlier this month, JPMorgan downgraded its rating on the stock from "overweight" to "neutral" and reduced its price target from $7 to $6. The stock is actively traded with an average daily volume of 11.12 million shares. Gerdau pays a 12.93% dividend.
MGIC Investment
MGIC Investment Corp. (MTG, Financial) is the parent company for Mortgage Guarantee Insurance Corp., which was formed in 1957 and based in Milwaukee.
The specialty insurance company has a market capitalization of $3.99 billion. It is trading with a price-earnings ratio of 4.93 and available for purchase at just 88% of book value. Price-to-free cash flow is 7.44. The earnings per share for 2022 showed growth of 51% and increased over the past five years at 16.80%. The amount of the company's long-term debt is greatly exceeded by shareholder equity. MGIC is actively traded with an average daily volume of 2.77 million shares. In January, Barclay's downgraded the stock from "overweight" to "equal weight" and reduced the price target from $16 to $14. MGIC Investment is paying a dividend of 2.90%.
Meritage Homes
Meritage Homes Corp. (MTH, Financial) is in the residential construction business and operates from corporate headquarters in Scottsdale, Arizona. The company focuses its work on so-called "Sunbelt" locations with an emphasis on the Southern and Western United States.
With a market capitalization of $3.97 billion, the stock trades just at book value -- a lower stock price would quickly take it below that level. Meritage has a price-earnings ratio of 4. The 2022 earnings per share showed an increase of 38.60%. The EPS growth rate over the past five years comes to 47.10%. Shareholder equity easily exceeds long-term debt. The stock is relatively lightly traded with an average daily volume of just 374,000 shares. Meritage Homes pays a 0.25% dividend.
Pangaea Logistics
Pangaea Logistics Solutions Ltd. (PANL, Financial) is a marine shipping stock based in Newport, Rhode Island, and with operations centers in Athens, Copenhagen and Singapore.
With a market capitalization of $306 million, the stock trades at a 5% discount from its book value with a price-earnings ratio of 3.69. The price-to-free cash flow metric is 3.33. Earnings per share for 2022 were up by 47.8% and for the past five years by 48%. Wall Street analysts do not believe that extraordinary level of growth can continue at such a remarkable rate. The stock is lightly traded with an average daily volume of just 164,000 shares. Pangaea is paying a dividend of 6.16%.
