If you’re searching for the best value stocks to buy now, look no further. Value stocks are back in the spotlight. Rising debt costs due to interest rate hikes make growth and tech less attractive for nervous investors. At the same time, a running bond bear market makes the once-safe asset allocation a losing proposition for those seeking a solution to stock market volatility.
Value stocks are primed to explode in 2024, as companies typically boast superior financial management practices, positioning them to ride out economic unease. Simultaneously, as bond yields increase and even savings accounts return 4% or more, value stocks’ consistent commitment to dividends means investors can capture yield alongside capital gains.
However, not all value stocks are created equally. Investors should look to the past when assessing financial management and consider future potential beyond simple belt-tightening. These seven value stocks to buy couple prudent financial management with fantastic prospects for 2024 and beyond.
Value Stocks to Buy: Medtronic PLC (MDT)
Medical device manufacturer Medtronic PLC (NYSE:MDT) is typically one of the top value stocks to buy on investors’ lists. While the stock traded flat for most of this year, losing about 2% since January, it’s been more stable than the wider market in recent weeks. To that end, though, Medtronic’s 2024 prospects are as exciting as ever, and today’s pricing presents investors with a perfect entry point.
MDT’s most recent earnings point to strong growth in the previous quarter. Revenue climbed 6% year-over-year (YOY) while the company accommodated tighter budgets by cutting research and development spending. While Medtronic’s financial management is consistently strong, its future potential lies largely in artificial intelligence (AI) healthcare solutions. Medtronic and Nvidia’s (NASDAQ:NVDA) early-2023 partnership to develop a range of AI platforming solutions will likely begin bearing fruit in early 2024, rewarding patient investors who held through the stock’s relatively flat range this year.
Medtronic’s trailing dividend yield is 3.58%, reinforcing its position as an ideal value stock today and into the new year.
Occidental Petroleum (OXY)
Warren Buffett’s favorite oil and gas company, Occidental Petroleum (NYSE:OXY), struggled slightly this year in light of volatile global energy markets. But the company’s position at the fore of carbon reduction and sustainability position it to capture a broad range of new revenue streams in 2024.
Last month, Amazon (NASDAQ:AMZN) announced a new deal with an OXY subsidiary focused on carbon capture. The partnership, which analysts expect could eventually cost Amazon $150 million, leverages OXY’s emerging direct air capture plant to reduce Amazon’s hefty carbon footprint.
The plant is one of the first nationally after the Bipartisan Infrastructure Law earmarked $3.5 billion for plant development and will let OXY expand its income streams as more corporate entities seek to offset their carbon footprint. As sustainability demands increase, legacy oil and gas companies must adapt – and OXY is one of the first (and only) in the sector to proactively lean into the trend.
OXY’s total trailing yield, including stock buybacks, is a hefty 7.39%. Warren Buffett’s preference for the stock should be a green flag for investors, and its 2024 prospects look bright.
Value Stocks to Buy: General Motors (GM)
General Motors (NYSE:GM) is a bit of a gamble in light of the ongoing labor strikes, but this car manufacturer tops the list of best value stocks to buy in the sector. Research firm EquitySet pegs the current price at nearly 50% below fair value, driven chiefly by losses caused by uncertainty surrounding the United Auto Workers strike. Still, if the company’s management and labor leaders come to a deal soon, GM could soar in 2024.
Despite the strike, the company’s most recent quarter report included a 21% sales jump. This is notable beyond the strike, as today’s tightened economy means household budgets are shrinking. If GM can keep moving cars off the line and into consumers’ hands despite a down economy, its prospects are bright as we move past this rocky period.
Most importantly for GM’s 2024 prospects, its electric vehicle (EV) offerings are increasingly popular, and sales for that segment jumped 33% YOY. GM now has six EV vehicles on the market, with more to come, cementing its second-place standing firmly, though it lags Tesla (NASDAQ:TSLA) by a wide margin.
Investors should expect stock buybacks to slow or stop in light of ongoing labor disputes (buybacks are a focal point for detractors pointing to misallocated funds). Still, the stock’s 8.95% total yield is an attractive selling point, even if it falls slightly in the coming months.
Banco Santander SA (SAN)
Banco Santander SA (NYSE:SAN) is less well-known of these value stocks to buy, but its Latin American market means the company has plenty of upside potential in a growing customer base. Furthermore, the company’s commitment to shareholder value drives a new buyback initiative, which will see the company repurchase $1.38 billion of its shares by January 2024. Couple that with a 3.3% trailing dividend yield, and Banco Santander is an ideal cheap value stock at today’s pricing.
Investors should note a degree of uncertainty within SAN’s organization today. It could cause short-term distress – but will likely play out beneficially in the long run. The company’s CEO is running an aggressive restructuring initiative. The operational realignment should boost profitability as it cuts down on inefficiency but might cause short-term volatility as the stock shakes things up.
The Latin American banking market, SAN’s primary target, has plenty of room to grow despite global economic unease. Banco Santander is an ideal value play for investors interested in geographic diversification to expose their portfolio to global banking.
Value Stocks to Buy: Whirlpool (WHR)
Bullish sentiment is bubbling up around Whirlpool (NYSE:WHR), making it another perfect value play for 2024. Institutional investors are also taking notice, as one investment management firm recently snatched up $1.474 million worth of Whirlpool stock. Much of the bullish sentiment comes from a recent earnings beat. Whirlpool reported $4.21 EPS, beating expectations by 45 cents. At the same time, Whirlpool generated a 29.70% return on equity, notable considering the economic challenges facing the firm nationally.
The company’s 5.46% trailing dividend yield will excite income investors as bond yields make fixed-income investing a more viable strategy, positioning Whirlpool as a perfect equity alternative to bonds and bond funds for those maximizing yield today.
H&R Block (HRB)
It’s almost tax time, meaning H&R Block (NYSE:HRB) is ready to rise to the occasion in 2024. The stock struggled earlier this year as rumors swirled, implying that the Internal Revenue Service would unveil a national, free filing solution. Today, though, HRB bounced back and is positioned to capture the tax return market alongside a slew of other revenue opportunities.
To buffer the cyclical effects of tax season on its revenue, HRB unveiled a mobile banking initiative in January. As of April, the mobile banking platform saw 291,000 customers jump on board, collectively depositing more than $280 million. Likewise, the company’s small-business accounting platform grew 10% YOY. Maintaining consistent cash flow has always been a struggle for HRB and similar tax-centric companies. Still, these initiatives pay dividends as more customers leverage the company’s tech year-round.
Speaking of dividends, the company boasts a massive 12.27% total yield between buybacks and distributions – that’s a hard stat to beat in today’s market, making HRB a perfect financial play for savvy investors.
Nintendo (NTDOY, NTDOF)
Nintendo (OTCMKTS:NTDOY, OTCMKTS:NTDOF) is a perfect blend of growth and value, and recent Nintendo news points to a substantial upside in 2024. Rumors began flying fast last month, as a leaked partnership between Nintendo and Google (NASDAQ:GOOG, NASDAQ:GOOGL) pointed to new possibilities in virtual reality. The leak, which is still unconfirmed by both parties, says the partnership will create a new virtual reality gaming platform. The gaming platform could leverage Nintendo’s industry dominance and Google’s next-generation micro-LED technology.
Soon after, email leaks from an ongoing Microsoft (NASDAQ:MSFT) court case revealed substantial executive interest in a high-level partnership or acquisition of Nintendo. While the emails were from 2020, nothing has yet materialized. Still, the massive corporate interest in Nintendo means the company is well-positioned to leverage its brand and holdings to explode in 2024.
Nintendo’s financial management is beyond reproach, which executives at Microsoft mentioned in the leaked emails. Today, the company sits on a ton of cash, meaning it’s positioned to weather economic uncertainty and take advantage of opportunities as they arise. The company’s trailing 3.24% dividend yield also benefits value investors as they wait for potential partnerships to play out.
On the date of publication, Jeremy Flint held no positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
