One strategy that has worked for me in recent months is finding stocks with robust dividend yields, low valuations and that are close to technical support levels. One such stock is International Paper (IP).
International Paper – “International Paper Company operates as a paper and packaging company with operations in North America, Europe, Latin America, Russia, Asia and North Africa." (Business description from Yahoo Finance)
Six reasons International Paper is a solid bargain at just over $26:
1. IP is selling just above technical support levels at $24 (see chart).
2. Another floor under the stock is its 4.1% dividend yield.
3. International Paper is selling in the bottom third of its five-year valuation range based on P/B, P/S and P/CF.
4. International Paper has easily beat earnings estimates over the last year. Over the last four quarters, IP has beat consensus estimates by an average of 16%.
5. The company has a forward PE of 8.3 which is a 55% discount to its five year average.
6. It is trading under analysts’ price targets. The median analysts’ price target on International Paper is $36.