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These 4 Low P/E Stocks are Too Good to Be True

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Still reeling from the Brexit episode, it seems like uncertainties are again imminent, thanks to a looming rate hike by the Federal Reserve and the upcoming Presidential Election.

Comments by some of the Fed officials have recently brought the speculation of an interest rate hike by the yearend to the forefront. Among the factors that back investors’ anticipation of a rate hike are economic growth, improving labor market conditions and consumer price inflation.

Meanwhile, the Presidential Election will have a major impact on stock markets because of the influence that the U.S. head of state has over fiscal policy. While an unworthy candidate winning the election dampens investor confidence, a worthy candidate would send the stock market rallying.

Crude prices are presently hovering near the $50 mark, supported by U.S.-Iran conflicts in the Gulf and speculation of weakening of the dollar post Janet Yellen’s speech in Wyoming on Friday. The upside was offset by the Saudi Arabian Energy Minister’s reluctance to initiate an OPEC intervention to cease output temporarily in order to combat the oil supply glut.

Brexit was followed by a sharp decline in stock prices, leaving a plethora of cheap picks for investors. Betting on these beaten-down stocks is probably a prudent option right now.

In value investing, investors select a stock that is trading lower than its fair value or intrinsic value and thus offers significant upside potential. However, not all cheap stocks can ensure high returns over the long haul.

For successful value investing, one should essentially pick fundamentally strong stocks with a low price/earnings (“P/E”) ratio.

A low P/E indicates that either a stock’s price has declined or that its earnings performance has been improving.

4 Stocks to Buy Right Now

Here, we have handpicked four attractive stocks with the help of our new style score system. All these stocks have the combination of a favorable VGM score of A, a Zacks Rank#1 (Strong Buy), a P/E ratio of less than 10 and a positive earnings surprise in the last reported quarter.

Aegean Marine Petroleum Network Inc. is a marine fuel logistics company that physically supplies and markets refined marine fuel and lubricants to ships in port and at sea. The company has a forward P/E ratio of 8.44 and delivered a positive earnings surprise of 39.13% in the last reported quarter.

Cooper-Standard Holdings Inc. (CPS - Free Report) operates as a supplier of systems and components for the automotive industry. The company has a forward P/E ratio of 9.8 and delivered a positive earnings surprise of 22.32% in the last reported quarter.

Outerwall Inc. specializes in automated retail solutions. Its offerings consist of Redbox entertainment, which allows customers to rent or purchase movies and video games from self-service kiosks; Coinstar money services, which enable customers to convert coin to cash or stored value products at self-service coin-counting kiosks; and ecoATM electronics recycling, where consumers can recycle electronic devices for cash at self-service kiosks. The company has a forward P/E ratio of 7.82 and delivered a positive earnings surprise of 77.21% in the last reported quarter.

Trinseo SA (TSE - Free Report) is a global materials company and a manufacturer of plastics, latex and rubber. It has a forward P/E ratio of 8.07 and delivered a positive earnings surprise of 39.39% in the last reported quarter.

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