Cheap Stocks: ING Groep (ING)
ING Stock Price: $13.60
Like BBVA, this Dutch financial supermarket is a beaten-down buy. Shares in ING Groep (ING) have bounced around in a tight range all year, leaving it down 2% YTD — for now. The Netherland’s biggest bank by assets is about to come out from under state government support, and that will let the stock breathe.
Once one of the biggest lenders in Europe, ING fell apart during the financial crisis. But after shedding and selling assets, it has transformed it self into a smaller, simpler and more nimble enterprise.
True, really big upside in ING stock might be limited by the the hangover of the financial crisis, but disbursing 40% to 50% of net operating profit should keep investors plenty happy.
For the longer term, ING stock has room for multiple expansion. The forward P/E is 8.5, while the P/B is a discounted 0.8. And once the dividend comes back, that will open the stock to equity income investors and funds. That demand alone should lift ING out of the realm of cheap stocks.