The markets recent declines have thrown up some great bargainsfor Foolish investors who arent afraid to invest against the grain. Three such bargains areBT (LSE: BT.A),British Land (LSE: BLND) andLegal & General (LSE: LGEN), all of which are well-run companies withillustrious historiesand, after recent declines, are now trading at attractive valuations.
The market leader
After its recent acquisition of mobile operator EE, BT is now the UKs undisputed top telecoms company, which makes it the perfect investment for long-term investors who want a buy-and-forget investment for their portfolio.
Over the past decade, BT has shown that it can continue to rack up returns for investors even in the most turbulent times. For example, over the last ten years, BTs shares have produced a capital gain of 119%, and thats excluding dividends. If you include dividends, returns would have been closer to 160%, excluding reinvestment. Over the same period, the FTSE 100 has returned a shocking -1.3%, excluding dividends. (Yes, minus 1.3% thats not a typo).
And BT looks set to continueto outperform going forward.BTs earningsper share are expected to fall this year due to the higher number of shares in issue following last years rights issue. However, the companys underlying pre-tax profit is expected to increase by 19% this year and a further 11% during 2017. BTs shares currently yield 2.9% and trade at a forward P/E of 15.5.
Property concerns
British Land has seen its shares fall following concerns about the state of the London real estate market. This sell-off has left British Land trading at its biggest discount to net asset value since 2011.
British Land is one of the UKs largest REITs, and its also one of the cheapest. At the end of September 2015, the companys net asset value came in at 891p per share, so at present levels, the company is trading at a 23% discount to NAV.
Still, if the commercial property market is about to take a tumble, British Lands NAV will fall in line with the wider market. The companys dividend yield stands at 4.1%, and the shares currently trade at a forward P/E of 25.1.
A play on retirement
As Ive written before,Legal & General believes that over the next 15 years the value of savings inUKdefined contribution pension schemes will nearly quadruple. Its estimated that the value of defined contribution pension schemes will jump from around 700bn today to approximately3.3tn by 2030, as more people take control of their own pensions.
As one of the UKs largest savings and pensions providers, Legal & General is one of the best ways to play this boom. After recent declines, the companys shares now trade at their lowest valuation in more than two years. Legal & Generals shares currently trade at a forward P/E of 13.9 and support an incredibly attractive dividend yield of 5.6%.
The income revolution
Income investments like Legal & General are the perfect way to build wealth over the long term. By reinvesting the dividends received from such investments, you can compound your money steadily without much effort at all.
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Rupert Hargreaves has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.
