15 Undervalued Large Caps Offering High Dividends

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 |  Includes: AZN, AZSEY, BNPQY, CS, LUKOY, MT, PBR, RDS.B, REPYY, SAN, SDRL, SLF, SSL, TEF, VIV
by: Dividendinvestr

Stocks with low P/E ratios are generally considered to be undervalued by the market and safe to invest in. Such stocks have more potential in price growth and are thus welcomed by investors. Of course there might be legitimate reasons for low P/E ratios as well, so investors should do their due diligence before buying stocks with low P/E multiples.

Defensive investors like stocks with high dividends since they believe such stocks can protect them from inflation risk. We are concerned about the Fed’s inflationary monetary policy and therefore we recommend investors play defensively by investing in high dividend stocks, especially those with low P/E ratios.

Below we compiled a list of 15 high dividend stocks with low P/E ratios. All companies have at least a $10 billion market cap, dividend yields higher than 4%, P/E ratios lower than 10 and are among the lowest 20% in their industry. The market data is sourced from Fidelity.

Company Name

Symbol

Dividend Yield (%)

YTD Return

TELECOMUNICACOES DE SAO PAULO

VIV

13.642

8.09%

LUKOIL

LUKOY

7.41

-12.3%

REPSOL YPF SA

REPYY

5.518

-6.0%

ASTRAZENECA PLC

AZN

6.087

-4.0%

TELEFONICA SA

TEF

10.322

-16.2%

SEADRILL LTD

SDRL

10.897

-18.8%

ROYAL DUTCH SHELL PLC

RDS.B

5.415

-6.9%

BANCO SANTANDER SA

STD

10.654

-24.5%

ALLIANZ SE

AZSEY

7.026

-21.3%

SUN LIFE FINANCIAL INC

SLF

6.114

-21.0%

BNP PARIBAS

OTCQX:BNPQY

7.496

-38.3%

SASOL LTD

SSL

4.48

-22.0%

PETROBRAS

PBR

5.536

-40.7%

CREDIT SUISSE GROUP

CS

5.637

-35.1%

ARCELORMITTAL SA

MT

4.714

-58.3%

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Telecomunicacoes De Sao Paulo (NYSE:VIV): VIV provides fixed-line telecommunications services in Brazil. VIV has a dividend yield of 13.64% and returned 8.09% so far this year. It has a market cap of $19.7B and a P/E ratio of 5.9.

Lukoil (OTCPK:LUKOY): Lukoil is a Russia-based integrated oil and gas company. LUKOY has a dividend yield of 7.41% and returned -12.29% so far this year. It has a market cap of $39.2B and a P/E ratio of 3.3. John Kleinheinz had $97 million invested in LUKOY.

Repsol YPF (OTCQX:REPYY): Repsol YPF SA is a Spain-based integrated oil and gas company. REPYY has a dividend yield of 5.52% and lost 6.01% so far this year. It has a market cap of $32.1B and a P/E ratio of 4.8.

Astrazeneca (NYSE:AZN): AstraZeneca is a global biopharmaceutical company. AZN has a dividend yield of 6.09% and returned -3.96% so far this year. It has a market cap of $59B and a P/E ratio of 7.6. Jim Simons and David Dreman both had over $20 million of AZN.

Telefonica (NYSE:TEF): Telefonica together with its subsidiaries and investees operates in the telecommunications, media and contact center industries. TEF has a dividend yield of 10.32% and returned -16.16% so far this year. It has a market cap of $86.3B and a P/E ratio of 6.3. Jim Simons had $13 million of TEF shares at the end of June.

Seadrill Ltd (NYSE:SDRL): SeaDrill Limited is a Bermuda-based company active in the oil and gas industry. SDRL has a dividend yield of 10.90% and returned -18.84% so far this year. It has a market cap of $12.8B and a P/E ratio of 6.2. Jeffrey Vinik and Bain Capital both invested more than $50 million in SDRL.

Royal Dutch Shell (NYSE:RDS.B): Shell is an independent oil and gas company. RDS.B has a dividend yield of 5.42% and lost 6.93% so far this year. It has a market cap of $82.8B and a P/E ratio of 6.8. Clint Carlson invested $80 million in RDS shares.

Banco Santander SA (STD): Santander is a financial group operating principally in Spain, the United Kingdom, Portugal, other European countries, Brazil and other Latin American countries and the United States, offering a range of financial products. STD has a dividend yield of 10.66% and returned -24.51% so far this year. It has a market cap of $67.9B and a P/E ratio of 6.2. Ken Fisher invested $334 million in STD shares.

Allianz (OTCQX:AZSEY): Allianz SE is a Germany-based financial services provider. AZSEY has a dividend yield of 7.03% and returned -21.31% so far this year. It has a market cap of $42.2B and a P/E ratio of 6.5.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.