For Immediate Release
Chicago, IL – May 22, 2020 – Zacks Value Trader is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here:
This Book Changed Warren Buffett's Life
Welcome to Episode #191 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.
At the 2020 Berkshire Hathaway annual meeting in May 2020, Warren Buffett again discussed his investing mentor, Benjamin Graham, describing him as one of the smartest people he’s ever met.
He also said that Graham’s Book, The Intelligent Investor, changed his life.
First published in 1949, The Intelligent Investor was the first investing book to be written for Mom and Pop investors.
Tracey has covered several different chapters of the 600 page book on previous podcasts.
But this week, given the volatility in the stock markets thanks to the coronavirus crisis, she tackled the final chapter, Chapter 20, appropriately titled: “Margin of Safety as the Central Concept of Investment”.
How Can You Find Margin of Safety Stocks?
Graham discusses investing in companies that have paid dividends over a number of years and in abnormal market conditions, such as a recession.
As we have seen this year, many companies have suspended their dividend due to the uncertainty around COVID-19.
But what about those companies that are still paying it?
And what if they also were Zacks Ranks of #1 (Strong Buy) and #2 (Buy), which hopefully means rising earnings estimates?
5 Margin of Safety Stocks
1. AbbVie (ABBV) just closed on its big acquisition of Botox maker Allergan. This Zacks Rank #1 (Strong Buy) drug maker is paying a dividend yielding 5.2%. It’s also dirt cheap, with a forward P/E of just 8.5.
2. B&G Foods (BGS) is having its day in the sun as Americans are buying packaged foods in droves thanks to the coronavirus shutdowns. It has 50 brands in its arsenal including Green Giant, Spice Islands and Cream of Wheat. It recently announced its dividend, the 63rd consecutive payment to shareholders. It’s currently yielding 8.2%.
3. H&R Block, Inc. (HRB) is apparently still paying the dividend which is yielding 6.3%. This Zacks Rank #2 (Buy) is the cheapest stock here, with a forward P/E of just 5.3.
4. Microsoft (MSFT) has been paying a dividend for over a decade and with its cash hoard, is unlikely to suspend it during the crisis. But shareholders are only getting a yield of 1.1% and investors will have to pay 32x forward earnings to own it.
5. Apple (AAPL) also has a big cash hoard, so it too should easily be able to pay its dividend during 2020. But it’s yielding even less, at just 1%, as the tech giant’s forward P/E has risen to its highest in over a decade, at 25.
What else should you know about Benjamin Graham and the book that changed Warren Buffett’s life?
Tune into this week’s podcast to find out.
[In full disclosure, Tracey owns shares of MSFT in her personal portfolio.]
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
Today, See These 5 Potential Home Runs >>
Zacks Investment Research
800-767-3771 ext. 9339
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Microsoft Corporation (MSFT) : Free Stock Analysis Report
Apple Inc. (AAPL) : Free Stock Analysis Report
HR Block, Inc. (HRB) : Free Stock Analysis Report
BG Foods, Inc. (BGS) : Free Stock Analysis Report
AbbVie Inc. (ABBV) : Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research