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5 Ultra-Cheap Value Stocks With Solid Dividends

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Stocks that offer lucrative returns are usually on investors’ radar. However, returns are subject to various unanticipated company-specific as well as macroeconomic factors.

Investors find a safe haven in stocks that offer solid dividend income as part of total returns, are trading at a lower price than peers or have high market capitalization.

High Dividend Yielding Stocks

Such stocks are attractive, in particular when macroeconomic volatility is ripping markets apart, by virtue of their guaranteed high dividend yield.

Cheap Value Stocks

Such stocks are undervalued when compared to peers or the industry average and are yet to realize their intrinsic value. Investors take interest in such stocks as they are likely to scale to the industry average in the long run on solid prospects. These stocks are also promising picks from the earnings growth perspective.

We can safely conclude that stocks that are inexpensive and offer solid dividends help investors better navigate economic uncertainties.

5 Stocks to Buy Now

Selecting a dividend stock trading at a discount can be a daunting task as one must not only consider the past performance of the company but also its prospects. Stocks that have traditionally paid handsome dividends in the past might see troubled times in the days ahead.

Hence, apart from considering the high dividend yield, we will zero-in on stocks that also offer promising value metrics (Value Score of A). The Value Style Score condenses all valuation metrics into one actionable score that helps investors steer clear of ‘value traps’ and identify stocks that are truly trading at a discount.

We have further narrowed down our choices with a favorable Zacks Rank #1 (Strong Buy) or 2 (Buy), indicating robust fundamentals and expectations of outperformance in the near term.

Based on the above criteria, we have selected five stocks that have a Value Score of A; a dividend yield higher than 3%; forward price to earnings (P/E) ratio less than 10; and market capitalization greater than $100 million.

USD Partners LP (USDP - Free Report) is engaged in acquiring, developing and operating energy-related rail terminals and other. It also manages complementary midstream infrastructure assets and businesses.

Dividend yield of 12.95%

P/E (F1) ratio of 8.99 (versus 19.8 of its industry)

The company currently sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Subsea 7 S.A. (SUBCY - Free Report) operates as an engineering, construction and services contractor in the offshore energy industry worldwide.

Dividend yield of 3.81%

P/E (F1) ratio of 9.80 (versus 45.90 of its industry)

The company currently carries a Zacks Rank #1.

Alliance Holdings GP, L.P. is a producer and marketer of coal for industrial and utility users in the United States.

Dividend yield of 10.5%

P/E (F1) of 7.93x (versus 8.98 of its industry)

Alliance Holdings currently carries a Zacks Rank #2

Uniti Group Inc. (UNIT - Free Report) is a real estate investment trust company.

Dividend yield of 13.04%

P/E (F1) of 7.27x (versus 12.78 of its industry)

The company currently carries a Zacks Rank #2.

Legal & General Group Plc (LGGNY - Free Report) is a leading risk, savings and investment group based in the U.K.

Dividend yield of 5.15%

P/E (F1) ratio of 8.50 (versus 12.95 of its industry)

The company currently carries a Zacks Rank #2.

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