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Investors pay for growth. The price for growth depends on many factors like the future perspective, the interest level or the greediness factor. A ratio that measures the price for growth is the price-earnings to growth ratio, also known as PEG ratio. Within the financial community, a value of less than one is often used to discover cheap stocks.

I screened the stock market by stocks with a PEG ratio of less than one as well as a dividend yield of more than 5 percent (high yield). In order to exclude stocks with small-cap risks, I decided to look for stocks with a market capitalization of more than $2 billion.There are 26 stocks that met these criteria. To get real bargains, the Price/Book ratio should be under one. Here are three interesting stocks from the screening results:

1. Banco Santander (STD) is acting within the foreign money center banks industry. The company has a market capitalization of $66.7 billion, generates revenues in an amount of $43.4 billion and has a net income of $11.3 billion. It follows P/E ratio is 5.9 and forward price to earnings ratio 4.9, Price/Sales 1.5 and Price/Book ratio 0.6. Dividend Yield: 10.8 percent. The PEG ratio amounts to 0.48.

2. Sun Life Financial (SLF) is acting within the life insurance industry. The company has a market capitalization of $13.5 billion, generates revenues in an amount of $21.6 billion and a net income of $1.9 billion. It follows P/E ratio is 7.4 and forward price to earnings ratio 7.4, Price/Sales 0.6 and Price/Book ratio 0.8. Dividend Yield: 6.3 percent. The PEG ratio amounts to 0.75.

3. Ares Capital (ARCC) is acting within the diversified investments industry. The company has a market capitalization of $2.8 billion, generates revenues in an amount of $575.3 million and has a net income of $446.0 million. It follows P/E ratio is 6.0 and forward price to earnings ratio 8.8, Price/Sales 4.8 and Price/Book ratio 0.9. Dividend Yield: 10.4 percent. The PEG ratio amounts to 0.69.

Take a closer look at the full table of 26 high yield stocks with low PEG ratios. The average price to earnings ratio (P/E ratio) amounts to 10.5 while the average forward P/E ratio is 8.1. The dividend yield has an average value of 7.6 percent. Price to book ratio is 3.5 and price to sales ratio 2.0. The operating margin amounts to 14.3 percent.

Source: 3 High Yield Stocks With Low PEG Ratios