Getting in while the getting is good represents a dream for any investor. Grabbing a company on its way up is always great, but it’s even better when you can know that you got the best possible price. However, just because a stock is at what appears to be a low point doesn’t mean it’s bottoming out. It may be in the middle of crashing, in which case investing would just be jumping on board a sinking ship.
So here are five companies that are very close to their 52-week low, but still show some strong valuations that might indicate that they’re ready to bounce back. As always, there’s no guarantee that these companies will grow, but if they do, now might be the time to buy.
Kyocera is a Japanese diversified electronics company, creating parts and components for use in a variety of electronic devices. Based in Kyoto, Japan, Kyocera was founded in 1959 as Kyoto Ceramics and changed its name in 1982. It’s original product was a ceramic insulator called kelcima used in television tubes, but the company has diversified its scope over the years. Currently sitting at just under 8 percent over its 52-week low, Kyocera’s share price is as cheap now as it’s been in some time. Add to this a PEG of just 0.29, P/E of just over 11, and projected EPS growth over the next 5 years of over 35 percent, and Kyocera could be an appealing buy.
It’s hard to say what the future is for television with Google (GOOG) and Apple (AAPL) both entering the space, but DIRECTV still shows some potential to continue growth. It had an up and down year in 2011, growing large before experiencing the same early August swoon that hit most of the market. However, over the last year, DIRECTV is up just over 2 percent. It remains just under 10 percent over its 52-week low, and shows relatively strong valuations and healthy projections for EPS growth.
Arch Coal (ACI)
So one might have moral qualms about throwing money into the company that bought Massey Energy, but Arch Coal is a coal mining company and that’s a business that doesn’t appear to be getting any worse in the near future. What’s more, Arch has some strong valuations, like a PEG just over 0.5 and a Forward P/E ratio of just over 6.25. Throw in projected EPS growth of over 30 percent projected over the next five years and there’s reason to be optimistic about Arch Coal. However, the company had a brutal 2011, losing almost 60 percent of its share value and leaving Arch Coal currently sitting almost 6 percent over its 52-week low.
Resolute Forest Products (ABH)
Resolute Forest Products, formerly AbitibiBowater Inc, was in bankruptcy protection as recently as 2010. The company, which is still legally under its old name but has been operating under the new name since November 7th of last year, makes a variety of forest products, including paper and wood products, as well as working in the recycling segment. Resolute Forest Products returned to profitability after leaving bankruptcy, but it got hit hard in the summer of 2011, losing almost half of its share value over the course of the year. However, for some, this could be viewed as a buying opportunity, as Resolute Forest Products is only 7.66 percent over its 52-week low. Meanwhile, the company has a series of solid valuations, including a P/E of just under 0.5, a Forward P/E of under 9, and a price to sales of about o.3.
R.R. Donnelley & Sons Company (RRD)
R.R. Donnelley & Sons is a business services company that provides print and related services. The company’s origins date all the way back to 1864 when it was founded by Richard Robert Donnelley. While printing is hardly an industry that boasts strong long-term potential at this point, R.R. Donnelley appears to show some solid potential. It’s coming off of a rough 2011, when it lost over 30 percent of its share value, and it’s currently sitting less than 5 percent over its 52-week low. However, it has several strong valuations, including a P/E of just over 10, a Forward P/E of about 7, and a PEG of under 1. Perhaps the most intriguing, though, is the company’s hefty dividend yield which is currently at 8.5 percent.
Data from finviz.com