Top 15 Most Undervalued High Dividend Yield Stocks

The following list of stocks might appeal to value and income investors. To compile this list we started with a universe of over 100 stocks with market caps above $300M and dividend yields that were greater than 2%. We then looked at the components of the Graham number equation and identified the most undervalued companies. The Graham number is an estimate of the fair value of a stock, and it is derived using earnings per share and current book value per share. The Graham Number = Fair Value Of A Stock = Square Root of ((22.5) x (Earnings Per Share) x (Book Value Per Share)). The logic behind the math is predicated on Graham’s belief that the price-to-earnings (P/EPS) ratio should be no more than 15, and the price-to-book value (P/BVPS) ratio should be no more than 1.5. As a result, the product of the two should not be more... Read more