5 Dividend-Paying, Low P/E Stocks

These 5 stocks are cheap if by cheap you mean the classic Benjamin Graham method of qualifying them. In his classic works on stock-picking, he broke it down into about 5 qualities that would merit investor attention: low price-earnings ratio, below book value, dividend-paying, earning money and a non-alarming debt situation.

This old-school method of finding undervalued companies is not as popular as it used to be but with the markets selling off from the beginning of the year, cheap stocks can be found, discussed and admired again. Whether they turn into long-term values from here is another question, but these 5 seem to qualify:

Compania de Minas Buenaventura (NYSE: BVN) is a Peruvian metals and mining company focused mostly on the production of gold, silver and copper. Based in Lima, they’ve been around for 68 years and were the first Latin American mining firm to be listed on the New York Stock Exchange.

Right now, Buenaventura is available for purchase at just 46% of its book value and trades with a price-earnings ratio of 7.40 (the p/e of the S&P 500 is 20.37). Earnings per share this year are up 187% and the past 5-year EPS growth is 19.20%. The dividend is 1.36%. Shareholder equity greatly exceeds long-term debt.

Crescent Point Energy (NYSE: CPG) is a Canadian-based oil and gas exploration company. They’re headquartered in Calgary, Alberta with operations in that province, in Saskatchewan and in North Dakota. The company’s July, 2022 ESG presentation right here.

Crescent Point is trading with the low price-earnings ratio of 2.78 and at 69% of its book value. The company is paying a dividend of 3.91%. This year’s earnings per share are up by 186% and the past 5-year EPS growth comes in at 33%. Long-term debt is a small percentage of shareholder equity.

General Motors
GM
(NYSE: GM) is the well-known, name brand Detroit car company that now manufactures electric vehicles as well as the gas-powered variety. This is a big outfit: 155,000 employees on 6 continents in 22 time zones. They’ve been in business for more than 100 years.

General Motors trades at a 10% discount to its book value and with a price-earnings ratio of 7.51. The past 5-years EPS growth is a mere 2.20% but this year’s earnings per share are up by 54%. The company has more long-term debt than shareholder equity (1.22x equity) but with the price-to-free cash flow metric at 20, analyst worry is low. GM pays a .91% dividend.

Hewlett Packard Enterprise
HPE
(NYSE: HPE) is the well-known, name brand communications equipment company now offering “cloud services” products. From corporate headquarters in Spring, Texas, the company has a storied history involving a 1939 founding by Bill Hewlett and David Packard from a California garage.

Hewlett Packard trades with a price-earnings ratio of just 4.94 and at a 13% discount to its book value. This years earnings per share growth is 3.60% and the past 5-year EPS growth rate is 6.70%. Shareholder equity exceeds long-term debt. The company pays a dividend of 3.50%.

Honda Motor Company (NYAW: HMC) is the name brand Japanese-based auto manufacturer. The company established North American operations decades ago with the help of an effective “you meet the nicest people on a Honda” advertising campaign. Honda and LG Energy just announced plans to build a $4.4 billion electric vehicle battery plant in Ohio.

The company can be picked up at 56% of its book value and trades with a price-earnings ratio of 9.91. Earnings per share are up this year by 8.00% and the past 5-year record of EPS growth is 3.70%. This is another one where shareholder equity exceeds long-term debt. Honda is paying a 3.69% dividend.

Not investment advice. For educational purposes only.