15 High-Dividend Stocks To Pick Up On The Cheap

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Includes: AEP, COP, CS, E, ENIA, ETR, HSBC, NLY, ORAN, PCG, RDS.A, RTN, SNY, TOT, VOD
by: Insider Monkey

Defensive investors like to purchase high dividend-stocks in order to achieve sustainable returns. They also tend to pick stocks with low price-to-book ratios, as these stocks are likely to be undervalued by the market.

Below we compiled a list of 15 undervalued high-dividend stocks. The market data are sourced from Fidelity. All companies on the list are large cap stocks and have at least 4% dividend yield, P/B ratio lower than 1.5 and P/E ratios among the lowest 20% in their industries.

Company

Symbol

Dividend Yield

P/B Ratio

Return since June

HSBC Holdings Plc

(HBC)

4.53%

0.91

-19.16%

VODAFONE GROUP

(NASDAQ:VOD)

5.64%

0.94

-4.23%

ROYAL DUTCH SHELL

(NYSE:RDS.A)

5.22%

1.21

-9.57%

TOTAL

(NYSE:TOT)

7.23%

1.13

-22.77%

CONOCOPHILLIPS

(NYSE:COP)

4.08%

1.27

-13.11%

SANOFI

(NYSE:SNY)

5.47%

1.1

-19.72%

ENI SPA

(NYSE:E)

8.11%

0.89

-23.39%

FRANCE TELECOM SA

(FTE)

12.33%

1.04

-21.19%

CREDIT SUISSE GROUP

(NYSE:CS)

6.35%

0.75

-40.34%

AMERICAN ELECTRIC POWER

(NYSE:AEP)

4.96%

1.28

-0.19%

ANNALY CAPITAL

(NYSE:NLY)

14.53%

1.08

-0.78%

PG&E CORP

(NYSE:PCG)

4.49%

1.38

-3.45%

RAYTHEON CO.

(NYSE:RTN)

4.19%

1.42

-16.86%

ENERSIS SA

(ENI)

4.25%

1.45

-20.48%

ENTERGY CORP.

(NYSE:ETR)

5.23%

1.31

-5.63%

Click to enlarge

These 15 stocks have an average return of -14.72% vs. -10.78 for the SPY since the end of June. Six of the stocks – AEP, NLY, PCG, VOD, ETR, and RDS.A – outperformed the market during that period.

Here are the 10 stocks in the list with the highest dividend yields:

Annaly Capital Management Inc (NLY) owns, manages and finances a portfolio of real estate-related investments. It has a dividend yield of 14.53% and a P/B ratio of 1.08. NLY lost 0.78% since the end of June, and it has a market cap of $17.3B and a P/E ratio of 6.9. Bill Miller holds the biggest position in NLY.

France Telecom Sa (FTE) is a France-based telecommunications operator that offers fixed and mobile communications, data transmission, Internet and multimedia, and other value-added service. It has a dividend yield of 12.33% and a P/B ratio of 1.04. FTE lost 21.19% since the end of June, and it has a market cap of $42.4B and a P/E ratio of 8.0. Steven Cohen holds the biggest position in FTE.

Eni Spa (E) is engaged in the oil and gas exploration and production, gas marketing operations, management of gas infrastructures, power generation, petrochemicals, oil field services and engineering industries. It has a dividend yield of 8.11% and a P/B ratio of 0.89. E lost 23.39% since the end of June, and it has a market cap of $66.0B and a P/E ratio of 6.9.

Total SA (TOT) is a France-based integrated international oil and gas company. It has a dividend yield of 7.23% and a P/B ratio of 1.13. TOT lost 22.77% since the end of June, and it has a market cap of $100.0B and a P/E ratio of 5.9. Robert Rodriguez and Steven Romick hold the biggest positions in TOT.

Credit Suisse Group (CS) is a financial services company providing advisory services, solutions and products to companies, institutional clients and private clients globally, as well as to retail clients in Switzerland. It has a dividend yield of 6.35% and a P/B ratio of 0.75. CS lost 40.34% since the end of June, and it has a market cap of $27.9B and a P/E ratio of 3.4. Ken Fisher holds the biggest position in CS (see Fisher’s top stock picks).

Vodafone Group Plc (VOD) is a mobile communications company operating across the globe providing a range of communications services. It has a dividend yield of 5.64% and a P/B ratio of 0.94. VOD lost 4.23% since the end of June, and it has a market cap of $129.9B and a P/E ratio of 8.2. Boykin Curry holds the biggest position in VOD.

Sanofi (SNY) is a global, diversified healthcare company that discovers, develops and distributes therapeutic solutions focused on patients’ needs. It has a dividend yield of 5.47% and a P/B ratio of 1.10. SNY lost 19.72% since the end of June, and it has a market cap of $86.6B and a P/E ratio of 7.2. Ken Fisher holds the biggest position in SNY.

Entergy Corp (ETR) is an integrated energy company engaged primarily in electric power production and retail electric distribution operations. It has a dividend yield of 5.23% and a P/B ratio of 1.31. ETR lost 5.63% since the end of June, and it has a market cap of $11.3B and a P/E ratio of 10.4. Michael Messner holds the biggest position in ETR (check out Messner’s top stock picks).

Royal Dutch Shell Plc (RDS.A) is an independent oil and gas company. Shell is engaged worldwide in the principal aspects of the oil and gas industry and also has interests in chemicals and other energy-related businesses. It has a dividend yield of 5.22% and a P/B ratio of 1.21. RDS.A lost 9.57% since the end of June, and it has a market cap of $116.4B and a P/E ratio of 7.1.

American Electric Power Co Inc (AEP) provides electricity to customers in Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia, and West Virginia. It has a dividend yield of 4.96% and a P/B ratio of 1.28. AEP lost 0.19% since the end of June, and it has a market cap of $17.9B and a P/E ratio of 11.5. John A. Levin holds the biggest position in AEP.

Disclosure: I am long SPY, VOD, COP.