Zacks.com Highlights: Volkswagen AG, Tata Motors, TRI Pointe Group And Olympic Steel
Zacks Investment Research | Feb 01, 2018 09:05PM ET
For Immediate Release
Chicago, IL – Feb 2, 2018 - Stocks in this week’s article include: Volkswagen (DE:VOWG_p) AG (OTC:VLKAY) , Tata Motors Limited (NYSE:TTM) , TRI Pointe Group, Inc. (NYSE:TPH) and Olympic Steel, Inc. (NASDAQ:ZEUS) .
Screen of the Week of Zacks Investment Research:
4 High Earnings Yield Stocks to Boost Your Portfolio
When you are unsure whether to keep your money in stocks or bonds, one key financial metric that can come to your rescue is earnings yield. It is the inverse of the price-to-earnings (P/E) ratio and very useful for spotting undervalued stocks. Also, the ratio comes in handy for investors when they want to compare stocks with the market or fixed income securities.
Earnings Yield can be calculated as (Annual Earnings per Share/Market Price) x 100. It is useful in comparing a stock with other stocks as well as with fixed income securities. While comparing similar stocks, the one which gives high earnings yield should provide better returns.
This ratio is also useful for comparing the performance of a market with the 10-year Treasury yield. When the yield of the market index is higher than the 10-year Treasury yield, stocks can be regarded as undervalued in comparison to bonds. This implies that investing in the stock market is a better choice for a value investor.
However, while T-bills are free of risks, investing in stocks always comes with a caveat. Hence, it would be an excellent idea to add a risk premium to the Treasury yield while comparing it with the earnings yield of a stock or the broader market.
And that's what we're screening for today…
For the rest of this Screen of the Week article please visit Zacks.com at: Zacks Investment Research
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