In this article we will take a look at the The 10 Best Undervalued Dividend Stocks To Buy Now. You can skip our detailed discussion of the merits of dividend investing and go to 5 Best Undervalued Dividend Stocks To Buy Now.
Reopening the economy as the COVID-19 vaccine rollout allows for the safe resumption of business operations has failed to spark a bull run in the stock market. In fact, supply chain issues and price volatility surrounding tech-related growth stocks have fueled inflation fears, leaving investors scratching their heads in search of good returns. In these uncertain times, undervalued dividend-paying stocks can be a good hedge against the bearish outlook in the market, providing smart minds with reliable income and protection for their portfolio.
In conversations about dividend-paying stocks, the real estate industry gets all the attention, but the insurance and banking industry also has good options in this regard. The Goldman Sachs Group, Inc. (NYSE: GS), one of the world’s leading investment banks, has provided investors with a steady and growing dividend for decades. The Goldman Sachs Group, Inc. (NYSE: GS) has a diversified portfolio of investments and is unlikely to be affected by overall market dynamics, even during a recession.
Likewise, another reliable but more affordable option for dividend investors is The Allstate Corporation (NYSE: ALL), the Township of Northfield Insurance Company. The Allstate Corporation (NYSE: ALL) recently increased its dividend by nearly 50% and also has a history of regular and steadily increasing dividend payments to shareholders. The company’s stock has outperformed its competitors in the market despite recent losses from a hailstorm that swept through Texas and Oklahoma.
Quest Diagnostics Incorporated (NYSE: DGX) also deserves a mention in the list of undervalued stocks for dividends. The Secaucus-based biotech company pays a regular quarterly dividend to shareholders despite the high operational costs associated with the biotech industry. Quest Diagnostics Incorporated (NYSE: DGX) was recently cited in media reports claiming that tech giant Amazon.com, Inc. (NASDAQ: AMZN) is seeking a foray into the medical industry. Amazon.com, Inc. (NASDAQ: AMZN) plans to develop and sell home diagnostic kits.
Undervalued dividend stocks can offer investors several benefits, including hedges against inflation, income streams, preservation of capital, attractive returns in bearish or bullish markets, compound dividend growth and the benefits. that she brings, as well as many others. Historically, dividend-paying stocks have provided 43% of the S&P 500’s total returns. As retail investors looking to make a quick buck fuel more volatility, it has become even more important to look for safer options. and reliable to overcome market chaos.
Part of this uncertainty in stocks is linked to technological disruptions. The entire hedge fund industry is feeling the impact of the changing financial landscape. Its reputation has been tarnished over the past decade, during which its hedged returns have failed to keep up with the unhedged returns of stock indexes. On the other hand, Insider Monkey’s research was able to identify in advance a select group of hedge funds that have outperformed S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and February 26, 2021 , stock selections from our monthly newsletter returned 197.2%, compared to 72.4% for the spy. Our stock picks outperformed the market by over 124 percentage points (see details here). We were also able to identify in advance a select group of hedge fund stocks that significantly underperformed the market. We have been tracking and sharing the list of these stocks since February 2017 and they have lost 13% until November 16. This is why we believe that hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to get our stories delivered to your inbox.
With that in mind, here is our list of the 10 best undervalued dividend paying stocks to buy now. We have tried to list stocks with a PE ratio of around 10 that pay a healthy dividend and trade on exchanges in the United States.
Best Undervalued Dividend Stocks To Buy
10. First Horizon Corporation (NYSE: FHN)
Number of hedge fund holders: 30
PE ratio: 8.9
First Horizon Corporation (NYSE: FHN) is a Memphis-based holding company founded in 1864. It is ranked tenth on our list of the 10 Best Undervalued Dividend Stocks To Buy Now. The company owns First Horizon Bank which has 490 bank offices in 12 states in the United States. Some of the services offered by the company include mortgage banking, title insurance and loan closing, brokerage and correspondent banking, among others. First Horizon stock has returned nearly 111% to investors over the past year.
First Horizon Corporation (NYSE: FHN) is a good option for dividend investors. It declared a quarterly dividend of $ 0.15 per share on April 27, in line with the previous one and payable to shareholders in July. The forward yield was 3.28%.
At the end of the fourth quarter of 2020, 30 hedge funds in Insider Monkey’s database had $ 403 million in First Horizon Corporation (NYSE: FHN) stakes, the same value as in the previous quarter. valued at $ 378 million.
9. Ally Financial Inc. (NYSE: ALLY)
Number of hedge fund holders: 57
PE ratio: 9.1
Ally Financial Inc. (NYSE: ALLY) is a Michigan-based banking holding company founded in 1919. It is ranked ninth on our list of the 10 Best Undervalued Dividend Dividend Stocks To Buy Now. Some of the services provided by the company include auto financing, online banking, business loans, auto insurance, and mortgages among others. Ally also operates an electronic trading platform for financial assets. Ally stock has returned a whopping 224% to investors over the past twelve months.
In results released in April, Ally Financial Inc. (NYSE: ALLY) reported revenue of $ 1.93 billion for the first quarter of 2021, beating market estimates by more than $ 180 million and nearly 20% of turnover over the same period. Last year.
On hedge funds tracked by Chicago-based investment firm Insider Monkey Harris Associates is a major shareholder of Ally Financial Inc. (NYSE: ALLY) with 25 million shares worth over $ 1.1 billion.
8. Santander Consumer USA Holdings Inc. (NYSE: SC)
Number of hedge fund holders: 21
PE ratio: 7.0
Santander Consumer USA Holdings Inc. (NYSE: SC) is a Texas-based finance company founded in 1955. It is ranked eighth on our list of the 10 Best Undervalued Dividend Stocks To Buy Now. The company focuses on vehicle financing and third party services primarily in the United States. Santander stock has returned over 136% to investors over the past year. In addition to vehicle financing, the company provides financial products and loans for inventory, construction, real estate, working capital and other needs.
On April 28, Santander Consumer USA Holdings Inc. (NYSE: SC) reported earnings per share of $ 2.42 for the first quarter of 2021, beating market expectations by $ 0.94. Net financial income and other interest income was $ 1.37 billion during the period.
At the end of the fourth quarter of 2020, 21 hedge funds in Insider Monkey’s database had $ 408 million in stakes in Santander Consumer USA Holdings Inc. (SC), up from 20 in the previous quarter of ‘worth $ 429 million.
7. Manulife Financial Corporation (NYSE: MFC)
Number of hedge fund holders: 20
PE ratio: 9.3
Manulife Financial Corporation (NYSE: MFC) is a Canadian multinational insurance company founded in 1887. It ranks seventh on our list of the 10 best undervalued dividend paying stocks to buy today. The company has many segments that handle day-to-day operations, including wealth and asset management, insurance and annuity products, and corporate affairs. Manulife stocks have offered investors returns above 77% over the past year. The company operates in the United States under the John Hancock Financial brand. Unlike expensive names like Amazon.com, Inc. (NASDAQ: AMZN), The Goldman Sachs Group, Inc. (NYSE: GS) and The Allstate Corporation (NYSE: ALL), MFC is an affordable stock to buy, trading at around $ 20.
On May 7, investment counsel RBC Capital Markets downgraded Manulife Financial Corporation (NYSE: MFC) stock to Sector Perform from Outperform after the insurance company reported disappointing quarterly results.
On hedge funds tracked by Insider Monkey, a Toronto-based investment firm Galibier capital management is a major shareholder of Manulife Financial Corporation (NYSE: MFC) with 3.5 million shares valued at over $ 76 million.
6. Aflac Incorporated (NYSE: AFL)
Number of hedge fund holders: 35
PE ratio: 7.1
Aflac Incorporated (NYSE: AFL) is a Georgia-based insurance company. It was founded in 1955 and is ranked sixth on our list of the 10 best undervalued dividend paying stocks to buy now. Aflac stock has returned 595 to investors over the past twelve months. The company has separate segments dedicated to life insurance products in Japan and the United States. The Japanese segment offers policies for cancer, medical care, income support, and whole life and other insurance products.
On April 28, Aflac Incorporated (NYSE: AFL) reported profits for the first quarter of 2021, posting revenue of $ 5.8 billion, up nearly 14% from revenue from the same period last year, and exceeding market estimates by $ 340 million. .
At the end of the fourth quarter of 2020, 35 hedge funds in Insider Monkey’s database had $ 389 million in stakes in Aflac Incorporated (NYSE: AFL), up from 34 in the previous quarter of a worth $ 479 million.
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Disclosure: None. ten Best Undervalued Dividend Stocks To Buy Now was originally published on Insider Monkey.