For Immediate Release
Chicago, IL – May 11, 2021 – Stocks in this week’s article are LG Display Co., Ltd. (
LPL Quick Quote LPL - Free Report) , Dow Inc. ( DOW Quick Quote DOW - Free Report) , Eagle Bulk Shipping Inc. ( EGLE Quick Quote EGLE - Free Report) , Hancock Whitney Corporation ( HWC Quick Quote HWC - Free Report) and Franchise Group, Inc. ( FRG Quick Quote FRG - Free Report) . These High Earnings Yield Stocks Could Yield Huge Returns
Investors often use P/E ratio and other valuation metrics while picking undervalued stocks with solid upside potential. However, it is difficult to use the P/E ratio to compare stocks with fixed income securities. This is where earnings yield comes handy.
Earnings yield is calculated as (Annual Earnings per Share/Market Price) x 100. In other words, it is the inverse of the P/E ratio.
Other things remaining constant, a stock with higher earnings yield has the potential of providing comparatively greater returns. This metric is used to compare the performance of a market index with the 10-year Treasury yield as well.
For instance, if the yield of the market index is more than the 10-year Treasury, stocks can be considered as undervalued in comparison to bonds. In such a case, investing in the stock market would be a better option for a value investor.
However, given the risk-free nature of T-bills, it would be prudent to add a risk premium to their yield while comparing with a stock or the market index.
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/1530233/these-high-earnings-yield-stocks-could-yield-huge-returns Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year.
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Contact: Jim Giaquinto
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