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Welcome to Episode #368 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.
With earnings season rolling on, it’s time to find some dirt-cheap stocks with high Zacks Rank. The Zacks Rank, which is based on analyst earnings estimate revisions, changes a lot during earnings season as companies beat, or miss, and make changes to their full year guidance.
When the analysts are all raising their earnings estimates at the same time, those stocks usually see a higher Zacks Rank. That’s what we want. We want to buy companies with rising earnings estimates.
The top Zacks Rank, the Strong Buy, is rare. Currently, there are just 229 companies with the #1 (Strong Buy) rank.
Screening for Top Rank and Style Scores
It’s easy to screen for the top Zacks Rank of #1 (Strong Buy) plus the top Style Score for Value of A on Zacks.com.
Tracey also added a forward P/E of 10 or less, to get “dirt-cheap” stocks.
Those were the only three criteria in this screen. It returned 19 stocks.
5 Top Dirt-Cheap Stocks to Buy Now
1. North American Construction Group Ltd. (NOA - Free Report)
North American Construction Group is a Canadian company which provides equipment in the heavy construction and mining industries. It has a market cap of just $565 million.
Shares of North American Construction Group are down 1.1% year-to-date. It’s dirt-cheap with a forward P/E of just 6.4. North American Construction Group also pays a dividend, yielding 1.4%.
Should North American Construction Group be on your short list?
M/I Homes is a large national homebuilder with a market cap of $3.1 billion. Shares of M/I Homes are up nearly 300% in the last 5 years but they have pulled back this year, falling 13.7%.
M/I Homes is still dirt-cheap. It trades with a forward P/E of just 6.4. Earnings are expected to rise 12.2% this year.
Suzano is the world’s largest pulp producer. Headquartered in Brazil, Suzano has a market cap of $14.8 billion.
Shares of Suzano are up just 1.4% year-to-date but it is dirt-cheap with a forward P/E of just 1.0. How can it possibly be that cheap? What is going on? Earnings are expected to rise 388% this year to $10.59 from $2.17 last year.
JD.com operates a retail marketplace in China. It has a market cap of $45.6 billion. Shares of JD.com are up 13% year-to-date but are still down 47% over the last two years.
JD.com is still dirt-cheap. It has a forward P/E of 9.2. Earnings are expected to rise only 0.6% in 2024 but analysts are more bullish on 2025 with earnings growth expected to rise 12.3%.
Should JD.com be on your short list?
What Else Do You Need to Know About Dirt-Cheap Stocks to Buy Now?
Tune into this week’s podcast to find out.
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The Best Dirt-Cheap Stocks to Buy Now
Welcome to Episode #368 of the Value Investor Podcast.
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.
With earnings season rolling on, it’s time to find some dirt-cheap stocks with high Zacks Rank. The Zacks Rank, which is based on analyst earnings estimate revisions, changes a lot during earnings season as companies beat, or miss, and make changes to their full year guidance.
When the analysts are all raising their earnings estimates at the same time, those stocks usually see a higher Zacks Rank. That’s what we want. We want to buy companies with rising earnings estimates.
The top Zacks Rank, the Strong Buy, is rare. Currently, there are just 229 companies with the #1 (Strong Buy) rank.
Screening for Top Rank and Style Scores
It’s easy to screen for the top Zacks Rank of #1 (Strong Buy) plus the top Style Score for Value of A on Zacks.com.
Tracey also added a forward P/E of 10 or less, to get “dirt-cheap” stocks.
Those were the only three criteria in this screen. It returned 19 stocks.
5 Top Dirt-Cheap Stocks to Buy Now
1. North American Construction Group Ltd. (NOA - Free Report)
North American Construction Group is a Canadian company which provides equipment in the heavy construction and mining industries. It has a market cap of just $565 million.
Shares of North American Construction Group are down 1.1% year-to-date. It’s dirt-cheap with a forward P/E of just 6.4. North American Construction Group also pays a dividend, yielding 1.4%.
Should North American Construction Group be on your short list?
2. KB Home (KBH - Free Report)
KB Home is one of the large national homebuilders. It has a market cap of $4.96 billion.
Shares of KB Home are up 5.8% year-to-date. Over the last 5 years, the shares are up 150%. KB Home is still cheap, with a forward P/E of 8.
Should KB Home be on your short list?
3. M/I Homes, Inc. (MHO - Free Report)
M/I Homes is a large national homebuilder with a market cap of $3.1 billion. Shares of M/I Homes are up nearly 300% in the last 5 years but they have pulled back this year, falling 13.7%.
M/I Homes is still dirt-cheap. It trades with a forward P/E of just 6.4. Earnings are expected to rise 12.2% this year.
Should M/I Homes be on your short list?
4. Suzano S.A. (SUZ - Free Report)
Suzano is the world’s largest pulp producer. Headquartered in Brazil, Suzano has a market cap of $14.8 billion.
Shares of Suzano are up just 1.4% year-to-date but it is dirt-cheap with a forward P/E of just 1.0. How can it possibly be that cheap? What is going on? Earnings are expected to rise 388% this year to $10.59 from $2.17 last year.
Should Suzano be on your short list?
5. JD.com, Inc. (JD - Free Report)
JD.com operates a retail marketplace in China. It has a market cap of $45.6 billion. Shares of JD.com are up 13% year-to-date but are still down 47% over the last two years.
JD.com is still dirt-cheap. It has a forward P/E of 9.2. Earnings are expected to rise only 0.6% in 2024 but analysts are more bullish on 2025 with earnings growth expected to rise 12.3%.
Should JD.com be on your short list?
What Else Do You Need to Know About Dirt-Cheap Stocks to Buy Now?
Tune into this week’s podcast to find out.