The markets declines over the past three weeks have thrown up some fantastic bargains for investors to take advantage of.
So, here are just threeformer market darlings that have fallen from grace during the past few months and which now trade at, or near, 52-week lows.
Lloyds (LSE: LLOY) has seen a dramatic reversal in fortunes this year. After a mixed 2015, Lloyds shares have plunged by 12% so far this year, taking the banks shares back to a low not seen since 2013.
Most of Lloyds recent declines can be traced to concerns about the groups growth. City analysts expect Lloyds to report an underlying pre-tax profit of 8.2bn for the year ending 31 December 2015, but pre-tax profits are expected to fall to 7.9bn for 2016. Further, analysts are predicting that earnings per share will contract by 8% next year. Exceptional costs relating to PPI provisions arealso set to weigh on Lloyds figures, although its unclear how much these new provisions will cost the bank.
Nonetheless, for long-term holders, Lloyds remains an attractive proposition. At the end of the third quarter, the banks tier one equity ratio was 13.7%, up 0.4% from the figure of 13.3% as reported at the end of the first half. Management has stated that Lloyds will return any excess capital to investors via buybacks and dividends some City analysts have speculated that the bank could return as much as20bn to 25bn to shareholders over the next three years.
So, Lloyds is planning to throw a tidal wave of cash at investors over the next few years andafter recent declines, the banks shares look cheap. Indeed, Lloyds shares are now trading at a forward P/E of 8.6 and support a yield of 3.3%.
Last week,brewery and pub operatorMarstons(LSE: MARS) issued an extremely upbeat Christmas trading update within which it revealed that like-for-like sales were 3% ahead of last year.In the critical two-week Christmas trading period to2, January trading was good with like-for-like growth of 4.9% despite tough comparatives.
These results are all the more impressive when you consider Marstons tough operating environment. City analysts expect the company to report earnings per share growth of 6% for the year ending 30 September 2016 and based on the groups Christmas trading, it looks as if Marstons will hit this target.
Marstons shares are currently trading at a forward P/E of 12.7 and support a yield of 4.2% covered twice by earnings per share.
Shares inDe La Rue(LSE: DLAR) have fallen by 14% over the past twelve months as the company has issued several profit warnings and analysts have consistently lower their targets for the groups growth. However, De La Rue does have one attractive trait; its ability toliterallyprint money.
Indeed, De La Rues ROCE a metric thatcompares how much money is coming out of a business, relative to how much is going in eclipses that of its peers.
During its last financial year, De La Rues ROCE totalled 49.6%. To put that into perspective, according to my figures less than 3% of the worlds 8,000 largest companies managed to achieve an ROCE of greater than 40% last year.
De La Rues shares currently trade at a forward P/E of 13.9 for 2016 and support a yield of 5.6%.
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