I always scout for stocks with
cheap price ratios. Benjamin Graham was a great teacher about identifying
fundamentally cheap stocks and one of his most popular students were
billionaire Warren Buffett itself.
I love to buy
stocks that are not far away from its fundamentally reasonable price. Three
good indicators are Price-to-Book, Price-to-Sales and Price-to-Earnings.
Growth and a better
than anticipated business environment are the main driver for wealth which let
the stock price skyrocket.
Integrate both in your trading strategy
and you will get a better investment return.
Yesterday, I wrote about stocks that have tenfold their sales over the past decade. It is very impressive so see how strong can companies grow but if you look at Facebook, you pay a high price for that growth.
I'm not sure if your investment in twitter and facebook will pay-off as long-term investor. You must be carefully look at the P-Ratios.
Yesterday, I wrote about stocks that have tenfold their sales over the past decade. It is very impressive so see how strong can companies grow but if you look at Facebook, you pay a high price for that growth.
I'm not sure if your investment in twitter and facebook will pay-off as long-term investor. You must be carefully look at the P-Ratios.
I've created a
small sheet of cheap dividend stocks with a dividend yield hitting the 2% yield
mark. These are my criteria in detail:
- Dividend Yield
over 2%
- P/B under 2
- P/S below 2
- Forward P/E
under 15
- Market Cap over
2 billion
- Dividend Payout
ratio under 60%