Zacks.com Featured Highlights Include: Genesco, GreenTree Hospitality, Bristol-Myers Squibb, Barclays PLC And Valero Energy
Zacks Investment Research | Jan 15, 2020 08:54PM ET
For Immediate Release
Chicago, IL – January 16, 2020 –Stocks in this week’s article are Genesco Inc. (NYSE:GCO) , GreenTree Hospitality Group Ltd. (NYSE:GHG) , Bristol-Myers Squibb Co. (NYSE:BMY) , Barclays (LON:BARC) PLC (NYSE:BCS) and Valero Energy Corp. (NYSE:VLO) .
Snap Up These 5 Stocks with High Earnings Yields
Earnings yield is useful for investors concerned about the rate of return on an investment. This metric, expressed in percentage, is calculated as annual earnings per share (EPS) divided by market price per share — the inverse of the price-to-earnings (P/E) ratio.
While comparing stocks, if other factors are similar, the one with higher earnings yield is considered undervalued. That’s because this metric measures the anticipated yield (or return) from earnings for each dollar invested in a stock today.
Earnings yield is not as widely used as P/E ratio as a valuation metric but investors most commonly compare the earnings yield of a stock to the prevailing interest rates, such as the current 10-year Treasury yield, to get a sense of the return on investment it offers compared to virtually risk-free returns.
If the yield on the stock is lower than the 10-year Treasury yield, the stock would be considered overvalued relative to bonds. Conversely, if the yield on the stock is higher, it would be considered undervalued.
For the rest of this Screen of the Week article please visit Zacks.com at: Zacks Investment Research
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