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Tags: growth | value | stocks | investors

Barron's: 12 Stock Picks to Satisfy Growth, Value Investors

Barron's: 12 Stock Picks to Satisfy Growth, Value Investors
(Juergen-Priewe/Dreamstime)

By    |   Tuesday, 18 February 2020 09:17 AM EST

Growth stocks have trounced value in recent years. With the bull market over a decade old and valuations toward the high end of their historical range, many have called for a comeback in value investing.

"Growth stocks are most simply defined as those that are expected to increase their earnings or revenues at a faster rate than the rest of the market. Value stocks are those that trade at a discount to the market on various fundamental measures," Barron's said.

Barron’s decided to look for stocks in the S&P 500 that exhibit characteristics often sought out by both growth and value investors. They’re cheap on one key metric, but also expected to increase earnings faster than their peers this year.

“The index’s average free cash flow yield (FCF) — a measure of return — is currently 3.7%. Analysts also expect the S&P 500 to grow earnings per share by 8.1% in 2020,” Barron’s explained.

Here are the dozen stocks in the S&P 500 that are at least 75% more attractive than the index on both metrics.

           Name/Ticker/2020E EPS Growth/FCF Yield

  1. Valero Energy     VLO   82.4%         10.9%
  2. Marathon Petroleum  MPC  62.1%         11.9%
  3. Bristol-Myers Squibb  BMY  43.1%         7.0%
  4. NRG Energy        NRG  28.7%         8.7%
  5. General Motors  GM   28.2%         15.0%
  6. Qualcomm QCOM        22.2%         6.5%
  7. H&R Block HRB   20.7%         10.3%
  8. State Street         STT    17.6%         19.1%
  9. Alliance Data Systems ADS   16.0%         19.7%
  10. Anthem      ANTM        15.8%         6.5%
  11. PulteGroup         PHM 15.3%         8.0%
  12. Everest Re Group RE   14.7%         15.7%

However, fears that the coronavirus outbreak will hurt China’s economic prospects fueled a slump in investors’ global growth expectations, Bank of America Corp.’s survey showed.

A deterioration in the outlook for China saw bets for world economic expansion fall for the first time since October, in BofA’s poll conducted Feb. 6 through Feb. 13. A net 18% of respondents forecast stronger growth over the next 12 months versus 36% in January’s survey, according to a note, Bloomberg reported.

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InvestingAnalysis
Barron’s decided to look for stocks in the S&P 500 that exhibit characteristics often sought out by both growth and value investors.
growth, value, stocks, investors
315
2020-17-18
Tuesday, 18 February 2020 09:17 AM
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