The “new world order” that President George HW Bush talking about appears to be changing into the new, new world order now. And we’re in the teeth of that transition at this point. That means cheap stocks abound.
We have just emerged from a global pandemic that has dislocated economies around the world and made for a very uneven and unpredictable recovery from crisis. Central banks are letting go of their control that they took on in 2008.
And now, Russia has single-handedly begun to reshape the geopolitical map of Europe and sent shockwaves around the world.
It’s no surprise the markets are stepping back to take all this in from a safe vantage point, at least as safe and as distant as possible.
But the global economy will continue to chug along and there are great opportunities to buy into these turbulent conditions with low-priced stocks that have the stability and sharp management to get through and out the other side better than they entered.
- Newmark Group (NASDAQ:NMRK)
- Peabody Energy (NYSE:BTU)
- EnLink Midstream (NYSE:ENLC)
- Hope Bancorp (NASDAQ:HOPE)
- Petroleo Brasilieiro (NYSE:PBR)
- Ecopetrol (NYSE:EC)
- ICL Group (NYSE:ICL)
Cheap Stocks: Newmark Group (NMRK)
In New York City there are companies that have been doing business for nearly a century or more that have built their businesses quietly. They have A-list clients and have weathered the worst of times and enjoyed the best of times. But they don’t get a lot of fanfare beyond the Big Apple.
NMRK is one of those companies. And what’s more, it’s one of our top cheap stocks.
Launched in 1929, it has become a full-service commercial real estate services company. Whether it’s buying, selling, leasing, downsizing or upscaling, NMRK has the well-connected professionals that can help make it happen.
Over the years it has become a major international player as well. It’s said to be the firm that former president Donald Trump turned to when he wanted to sell his Washington, DC hotel.
NMRK stock has gained a whopping 71% in the past 12 months, 17% in the past month. And it still has a current price-to-earnings ratio just above 4x.
This stock has an “A” rating in my Portfolio Grader.
Peabody Energy (BTU)
King Coal has suffered a coup d’état when it comes to its primacy in the 21st Century. But as the old Mark Twain saying goes, the reports of its death are greatly exaggerated.
When geopolitical events cause chaos in the energy markets, many companies and utilities go back to conservative available resources to keep the engines of industry running. That has meant coal is coming back from exile.
In China, 2021 saw record profits for coal companies. And that’s a global trend. As energy consumption ramps up after the pandemic, demand for energy boost prices for all fuels, including coal. That’s great news for cheap stock BTU.
In the past 12 months, BTU stock has soared 299%, 43% year-to-date. Yet it still trades at a P/E of 7x.
Cheap Stocks: EnLink Midstream (ENLC)
In the energy business, when times are good — that is, when prices are high and rising — everyone one is a winner. The most leveraged winners are in the exploration and production (aka, E&P or upstream) companies. They have fixed extraction costs, so their margins increase as oil prices rise.
The pipeline (aka, midstream) companies aren’t affected by price because their business is all about volume. The greater demand from industry and consumers the greater the volume, and the higher their margin.
One downstream end, is refining and retail, where margins are thinner but steady demand helps keep them stable.
ENLC is a midstream player in the Southwest. And now that foreign supplies are constricted, domestic supply is ramping up. That means its heading from the oil fields of West Texas to refining operations in East Texas, Oklahoma and Louisiana.
ENLC also announced a new carbon capture and sequestration partnership earlier this month, which will certainly also boost its ESG credentials.
This stock has an “A” rating in my Portfolio Grader.
Hope Bancorp (HOPE)
It may seem contrary to investors not familiar with the financial services industry, but in times of rising interest rates, banks do a bang-up business.
Why? Because when rates are rising, there’s more room for them to build in margins on their lending products. When rates are low, competition keeps their margins tight and the difference between what they can borrow at and what they can lend at is tighter.
HOPE is a $17 billion bank with operations in California as well as 11 other states. It focuses on consumers as well as small and medium-sized businesses, with strength in the Korean-American community.
HOPE stock has a $2 billion market cap and has a generous 3.5% dividend. It has gained 21% in the past 12 months, and 10% YTD, yet has a P/E just below 10x.
This stock has an “A” rating in my Portfolio Grader.
Cheap Stocks: Petroleo Brasilieiro (PBR)
Better know in the U.S. as Petrobras, this is the biggest oil company in Brazil. And with a $92 billion market cap, it’s a significant player around the world.
It has ended up in our cheap stocks list because even Brazil’s big stocks trade at low prices, which belie their market size.
PBR is an integrated oil company, which means it does it all. It has upstream, midstream and downstream operations and has significant global exposure. Also, Brazil has some significant offshore reserves. PBR has the money to access them and also the money to lease the properties where the reserves exist.
The Brazilian economy fluctuates a great deal, but it has significant companies operating its commodities and they can get the goods to the world. PBR stock has gained 80% in the past 12 months, 27% YTD. It also has a staggering 14% dividend and P/E just above 3x.
This stock has an “A” rating in my Portfolio Grader.
Ecopetrol (EC)
Another South American integrated oil player is EC. It operates out of Colombia and has been in operation since 1948, so it’s a well established company that is a knowledgeable and experienced operator in the region.
With a market cap that’s about one-third that of its neighbor PBR, it’s not as big, but Colombia is a much smaller country as well. And there are reserves in Colombia — there are some big U.S.-based oil companies operating in the country as well.
During the current supply shortage, EC is a big beneficiary. It can supplement U.S. supplies of both crude and refined product without having to get it shipped from halfway around the world.
EC stock has gained 17% YTD yet still has a P/E of just above 10x. Given continued global instability, EC is in a great place to profit.
This stock has an “A” rating in my Portfolio Grader.
Cheap Stocks: ICL Group (ICL)
Quick: Who is the world’s No. 6 potash producer and a third of the world’s bromine? Hopefully you guessed ICL.
This Israel-based company delivers fertilizer and other chemicals from its mines in Spain, the UK, the U.S., China, South America and Ethiopia.
When global demand increases and growth increases, that also means demand — and prices — for the chemicals that ICL mines, refines and distributes also rise. Since there are fixed costs on these chemicals’ refinement and manufacture, it means ICL’s margins grow as prices rise.
Its $13 billion market cap means it’s a solid big-cap stock but it’s one of our top cheap stocks because it’s well positioned for global growth. ICL is up 91% in the past 12 months, 15% in the past three months, yet trades at a P/E just above 17x.
This stock has an “A” rating in my Portfolio Grader.
On the date of publication, Louis Navellier has a position in NMRK in this article. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.
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