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Do you consider yourself a dividend investor, looking for strong yields and sustainable payouts? Are you especially interested when you can find good dividend stocks at a discount? One place to look is in the financial space, where stocks are just coming off of a large sell-off. We ran a screen for stocks with these traits, focusing on the financial companies that look undervalued from a price-multiple perspective. To narrow in on the best of breed, we selected for only those stocks that analysts have recommended to buy. You might like the list we came up with.

The Price/Earnings ratio is one of the most commonly used price-multiple metrics. Often, EPS from the last four quarters is used to derive this number. A firm that has a high P/E ratio generally indicates that investors have high expectations of the firm relative to future earnings growth. By the opposite token, investors generally have lower expectations of a firm with a low P/E ratio. A firm that holds a P/E below 10 could be viewed as having "value investment" potential. One thing to remember is that EPS is an accounting measure that could be potentially manipulated. Thus the P/E is only as good as the quality of the earnings.

The forward P/E is a price multiple valuation metric, which is similar to the current P/E ratio, except that it uses the forecasted earnings instead. While this number might not be as accurate because it uses "forecasted" numbers, it does offer the benefit of illustrating analysts' expectations of a firm. If the market believes that earnings will grow moving forward, then the forward P/E should be lower than the current P/E. Financial Leverage, also known as the Equity Multiplier, illustrates how a firm is financing its assets. The lower the number the more a firm is financing its assets internally through stockholder equity. The higher this metric is the more the firm is relying on debt to finance its assets.

We first looked for financial dividend stocks. We then looked for companies that are trading at a discount (P/E<10)(forward P/E<10). We next screened for businesses that analysts rate as "Buy" (2 < mean recommendation < 3). We did not screen out any market caps.

Do you think these stocks are in strong positions for future growth? Please use our list to assist with your own analysis.

1) IRSA Investments and Representations Inc. (IRS)

Sector:Financial
Industry:Real Estate Development
Market Cap:$416.66M
Beta:1.63

IRSA Investments and Representations Inc. has a Dividend Yield of 11.93%, a Price/Earnings Ratio of 6.86, a Forward Price/Earnings Ratio of 5.54, and a Analysts' Rating of 2.30. The short interest was 0.81% as of 07/04/2012. IRSA Investments and Representations, Inc., through its subsidiaries and joint ventures, engages in a range of diversified real estate related activities in Argentina. It involves in the acquisition, development, and operation of shopping centers, as well as office and other non-shopping center properties primarily for rental purposes; the development and sale of residential apartment complexes and other residential communities; the acquisition and operation of luxury hotels; and the acquisition of undeveloped land reserves for future development and sale.

2) Homeowners Choice, Inc. (HCII)

Sector:Financial
Industry:Property & Casualty Insurance
Market Cap:$159.55M
Beta:0.71

Homeowners Choice, Inc. has a Dividend Yield of 4.42%, a Payout Ratio of 32.23%, a Price/Earnings Ratio of 8.74, a Forward Price/Earnings Ratio of 8.82, and a Analysts' Rating of 1.70. The short interest was 3.11% as of 07/04/2012. Homeowners Choice, Inc., an insurance holding company, provides property and casualty insurance in Florida. The company provides property and casualty homeowners' insurance, condominium owners' insurance, and tenants' insurance to individuals owning property. It offers its products and services through its subsidiaries and independent agents.

3) American Capital Agency Corp. (AGNC)

Sector:Financial
Industry:REIT - Residential
Market Cap:$10.18B
Beta:0.42

American Capital Agency Corp. has a Dividend Yield of 14.73%, a Payout Ratio of 81.17%, a Price/Earnings Ratio of 5.30, a Forward Price/Earnings Ratio of 6.76, and a Analysts' Rating of 2.00. The short interest was 2.77% as of 07/04/2012. American Capital Agency Corp. operates as a real estate investment trust (REIT). It invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by government-sponsored entities or by the United States government agency. The company funds its investments primarily through short-term borrowings structured as repurchase agreements.

4) KKR Financial Holdings LLC (KFN)

Sector:Financial
Industry:Mortgage Investment
Market Cap:$1.57B
Beta:2.54

KKR Financial Holdings LLC has a Dividend Yield of 8.18%, a Payout Ratio of 44.61%, a Price/Earnings Ratio of 5.12, a Forward Price/Earnings Ratio of 4.76, and a Analysts' Rating of 1.80. The short interest was 3.51% as of 07/04/2012. KKR Financial Holdings LLC, together with its subsidiaries, operates as a specialty finance company with expertise in a range of asset classes. It primarily invests in financial assets, such as below investment grade corporate debt comprising senior secured and unsecured loans, mezzanine loans, high yield bonds, and distressed and stressed debt securities; marketable equity securities; and private equity. The company also invests in other asset classes, such as natural resources and real estate.

5) Hatteras Financial Corp (HTS)

Sector:Financial
Industry:REIT - Residential
Market Cap:$2.84B
Beta:0.27

Hatteras Financial Corp has a Dividend Yield of 12.41%, a Payout Ratio of 98.05%, a Price/Earnings Ratio of 7.46, a Forward Price/Earnings Ratio of 7.67, and a Analysts' Rating of 2.00. The short interest was 4.75% as of 07/04/2012. Hatteras Financial Corp. operates as an externally-managed mortgage real estate investment trust (REIT). It invests in fixed-rate and adjustable-rate single-family residential mortgage pass-through securities guaranteed or issued by the United States Government agency or by the United States Government-sponsored entity, and the Federal Home Loan Mortgage Corporation.

*Company profiles were sourced from Finviz.

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

Source: 5 Financial Dividend Stocks Trading Below Value Despite Analyst Backing