Not many are interested in these types of value stocks even though they’re all paying a 3+% dividend and they’ve been making money. The focus these days is on growth stocks and cryptocurrencies. You’d have to be truly contrarian to want to consider anything other than Tesla TSLA TSLA TSLA TSLA TSLA TSLA TSLA or Bitcoin — at least, according to conventional wisdom.
For those contrarian-inclined, however, here are 5 cheap bank stocks now paying dividends greater than the 10-year Treasury rate. These are cheap in the Benjamin Graham sense of the word: selling at or below book value and with price/earnings ratios significantly lower than the market as a whole.
With a p/e of 13, the stock is priced well below that of the S&P 500’s multiple of 40. Cathay CATY CATY CATY is trading at 1.26 book value. The financial institution is profitable this year and the 5-year record of earnings is positive as well. Shareholder equity greatly exceeds long-term debt. Investors receive a dividend yield of 3.29%.
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Community Bankers Trust is based in Richmond, Virginia and trades on the NASDAQ.
The bank is available for purchase at its book value and the price/earnings ratio of 11 is low, even for the sector. Community Bankers Trust is having a good year of earnings and their record for the past 5 years is in the green. Long-term debt is much, much lower than shareholder equity. The bank pays a 3.11% dividend.
The financial services company has a p/e of just 13 and is being traded at just above its book value. Investors Bancorp has no long-term debt, an unusual feature of a publicly traded stock. They’re showing positive earnings this year and it’s the same on a 5-year look. The dividend payment is a hefty (for these days in this sector) 4.35%.
This is another banking institution is a very low price/earnings ratio: 10.3. The stock can be picked up at just above its book value. Shareholder equity greatly exceeds long-term debt. Earnings have been good for the past 5 years and that includes a positive last year. Republic FRBK FRBK FRBK pays a 3.02% dividend.
Trustmark Corporation is another NASDAQ-traded bank stock — this one is based in Jackson, Mississippi.
The p/e is definitely low at 12 and the stock trades at just above book value. Earnings this year are positive and that’s true of the 5-year record, too. Analysts expect next year’s earnings to be off. Trustmark’s long-term debt is almost, but not quite, at zero. Investors receive a 3.04% dividend.
These are not buy recommendations. Most of these regional banking stocks trade very little volume so it’s unlikely large institutional investment firms are taking positions. Whether this is a positive or a negative is up to individual investors to determine.
Stats courtesy of FinViz.com.
I do not hold positions in these investments. No recommendations are made one way or the other. If you’re an investor, you’d want to look much deeper into each of these situations. You can lose money trading or investing in stocks and other instruments. Always do your own independent research, due diligence and seek professional advice from a licensed investment advisor.