10 Undervalued Dividend-Paying Stocks With Momentum

Minyanville |

INTC, STX, JPM, NOC, ETN, COP, LMT, GD, PPL, RTN, BAC, SDYIn these dog days of summer, stocks aren't moving too much. Here are a few companies in the S&P 500 (SPY) that are could be very good for sitting back and collecting dividends.

These 10 companies have a much lower price-to-earnings (P/E) ratio than the average of 17.2 for the S&P 500 index, all have a dividend yield of over 3%, and some have been on a tear this year.

10. Intel (INTC)

P/E Ratio: 11.6
Dividend yield: 3.42%
One-month performance: +2.65%

9. Eaton Corp. (ETN)

P/E Ratio: 11.09
Dividend yield: 3.28%
One-month performance: +17.9%

8. ConocoPhillips (COP)

P/E Ratio: 11.08
Dividend yield: 4.60%
One-month performance: +$1.84

7. Lockheed Martin (LMT)

P/E Ratio: 10.82
Dividend yield: 4.33%
One-month performance: +6.36%

Like General Dynamics (GD) and Northrup Grumman (NOC) listed below, there is some fear out there that defense contracts will disappear on New Year's Day if Congress allows the country to tip over the "fiscal cliff," but additional stopgaps are more likely than that.

6. PPL Corporation (PPL)

P/E Ratio: 9.97
Dividend yield: 4.90%
One-month performance: +1.52%

5. Raytheon Co. (RTN)

P/E Ratio: 9.78
Dividend yield: 3.56%
One-month performance: +0.66%

4. General Dynamics (GD)

P/E Ratio: 9.59
Dividend yield: 3.11%
One-month performance: +1.57%

3. Northrup Grumman (NOC)

P/E Ratio: 8.89
Dividend yield: 3.17%
One-month performance: +7.54%

2. JPMorgan Chase (JPM)

P/E Ratio: 8.33
Dividend yield: 3.24%
One-month performance: +10.27%

JPMorgan Chase's stock price is 12.48% higher than it was at the start of the year, and that is even with the sell-off precipitated by the bank's disclosure of a $5.8 billion trading loss in May. We still have yet to see whether restatements of previous statements really wreck the company's financials. Even with a loss north of $4 billion in the second quarter, JPMorgan's share price is still low, compared to earnings. Bank of America (BAC) has a similar P/E ratio of 8.82, but doesn't share nearly as much with stockholders.

1. Seagate Technology (STX)

P/E Ratio: 5.53
Dividend yield: 3.59%
One-month performance: +30.6%

Today, Stiefel Nicolaus analysts downgraded this Irish company from a Buy to a Hold, following similar actions by Robert Baird and Barclays earlier this summer. Seagate has raised its dividend from $0.18 last year to $0.32 in the latest quarter. Since the beginning of the year, Seagate's share price has gone up over 100%.

By Vincent Trivett 

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Companies

Symbol Name Price Change % Volume
BAC Bank of America Corporation 15.40 -0.12 -0.77 25,897,457
BEE.P.ACL Strategic Hotels & Resorts Inc. 8.50 Ser A Pfd Sh n/a n/a n/a 0
COP ConocoPhillips 40.72 0.78 1.95 1,860,963
ETN Eaton Corporation PLC 63.43 0.12 0.19 238,055
GD General Dynamics Corp. 154.48 0.67 0.44 273,803
INTC Intel Corporation 36.74 -0.46 -1.22 8,141,551
JPM JP Morgan Chase 66.51 -0.75 -1.11 4,800,083
LMT Lockheed Martin Corporation 246.55 0.71 0.29 237,795
NOC Northrop Grumman Corporation 216.85 -0.21 -0.09 137,386
PPL PPL Corp 35.54 -0.16 -0.45 1,078,841
RTN Raytheon Company 138.67 0.09 0.06 245,368
STX Seagate Technology 36.95 0.49 1.34 1,657,563

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