The Cheapest Basic Material Dividend Stocks | 20 Low Priced Raw Material Shares (2024)

Basicmaterial dividend stocks with low forward P/E’s originally published at "long-term-investments.blogspot.com". Yesterday I read aninteresting article about the valuation of the market. We got a gainingmomentum. This year alone, the market rose around 15 percent and nobody scaresthis. The analysts from Bloomberg attempted to compare the situation with thesecond half of the 90ies where stocks started to boost until they burst.Historically we named this burst the technology bubble 2000.

Theanalyst wrote that the current valuation is still 28 below the mid 90ies. Themarket is not cheap but not expensive. Other investors talk about a reasonablepricing. They trust the market environment and the FED stimulus and they pay finally the high price.

I’ma long-term growth investor and I’ve also realized that most of thehigh-quality stocks are too expensive to get a good return. With P/E’s of 20you will definitely make no greater return. Sure, it could be possible thatyour investment got a 30 P/E in five years or so but that’s not investing, it’sspeculation.

Asyou might have seen, I started more screens with cheap price ratios asvariables. I still try to seek the cheapest opportunities from the market, butthere are only a dozen from each sector. Today I like to discover someideas from the basic material sector. I’m focused on large caps in my screen.

Basicmaterial stocks are still very cheap. The 20 stocks with lowest valuation can bepurchased for a multiple between 4 and 9 of expected earnings. That’s very lowcompared to my other screens. But you should also know that valuation is a questionof belief – Do you trust the earnings forecasts?

Here are my favoritestocks:

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BP (NYSE:BP) has a market capitalization of $136.72 billion. The company employs 85,700 people, generates revenue of $388.285 billion and has a net income of $11.816 billion. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $39.891 billion. The EBITDA margin is 10.27 percent (the operating margin is 5.08 percent and the net profit margin 3.04 percent).

Financial Analysis:The total debt represents 16.26 percent of the company’s assets and the total debt in relation to the equity amounts to 41.21 percent. Due to the financial situation, a return on equity of 10.07 percent was realized. Twelve trailing months earnings per share reached a value of $6.99. Last fiscal year, the company paid $1.98 in the form of dividends to shareholders.

Market Valuation:Here are the price ratios of the company: The P/E ratio is 6.16, the P/S ratio is 0.35 and the P/B ratio is finally 1.16. The dividend yield amounts to 4.88 percent and the beta ratio has a value of 1.20.

Long-Term Stock Price Chart Of BP (BP)

Long-Term Dividend Payment History of BP (BP)

Long-Term Dividend Yield History of BP (BP)

Vale (NYSE:VALE) has a market capitalization of $86.68 billion. The company employs 70,785 people, generates revenue of $47.694 billion and has a net income of $6.255 billion. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $18.892 billion. The EBITDA margin is 39.61 percent (the operating margin is 19.34 percent and the net profit margin 13.11 percent).

Financial Analysis:The total debt represents 24.49 percent of the company’s assets and the total debt in relation to the equity amounts to 43.37 percent. Due to the financial situation, a return on equity of 9.33 percent was realized. Twelve trailing months earnings per share reached a value of $1.24. Last fiscal year, the company paid $1.15 in the form of dividends to shareholders.

Market Valuation:Here are the price ratios of the company: The P/E ratio is 13.53, the P/S ratio is 1.84 and the P/B ratio is finally 1.17. The dividend yield amounts to 4.87 percent and the beta ratio has a value of 1.46.

Long-Term Stock Price Chart Of Vale (VALE)

Long-Term Dividend Payment History of Vale (VALE)

Long-Term Dividend Yield History of Vale (VALE)

Rio Tinto (NYSE:RIO) has a market capitalization of $85.36 billion. The company employs 71,219 people, generates revenue of $50.967 billion and has a net income of $-2,997.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $16.208 billion. The EBITDA margin is 31.80 percent (the operating margin is -7.08 percent and the net profit margin -5.88 percent).

Financial Analysis:The total debt represents 22.81 percent of the company’s assets and the total debt in relation to the equity amounts to 57.23 percent. Due to the financial situation, a return on equity of -6.00 percent was realized. Twelve trailing months earnings per share reached a value of $-1.66. Last fiscal year, the company paid $1.67 in the form of dividends to shareholders.

Market Valuation:Here are the price ratios of the company: The P/E ratio is not calculable, the P/S ratio is 1.77 and the P/B ratio is finally 1.82. The dividend yield amounts to 3.58 percent and the beta ratio has a value of 1.65.

Long-Term Stock Price Chart Of Rio Tinto (RIO)

Long-Term Dividend Payment History of Rio Tinto (RIO)

Long-Term Dividend Yield History of Rio Tinto (RIO)

Take a closer look at the full list of the cheapest basic material dividend stocks. The average P/E ratio amounts to 10.13and forward P/E ratio is 7.42. The dividend yield has a value of 2.77 percent.Price to book ratio is 1.31 and price to sales ratio 1.09. The operating marginamounts to 15.70 percent and the beta ratio is 1.31. Stocks from the list havean average debt to equity ratio of 0.44.

Here is the full table withsome fundamentals (TTM):

Low Valuated Basic Material Dividend Stocks (Click to enlarge)

Related stockticker symbols:

GGB, ABX, RIO,VLO, CEO, VALE, MPC, TOT, PKX, SNP, FCX, BP, ESV, PBR, PBR-A, CF, STO, IMO, APA,PSX

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*Ihave no positions in any stocks mentioned, and no plans to initiate anypositions within the next 72 hours. I receive no compensation to write aboutany specific stock, sector or theme.