Investors should pay more attention to stocks that are trading for a discount. They offer outstanding buying opportunities, especially if the stock starts to gain momentum. Investors will have bought in at a low price.
A large number of investors tend to follow the popular stocks and ones that have already seen incredible share price appreciation. And are inclined to avoid companies that aren’t as exciting even though their long-term possibility of overall success may be much greater.
When choosing stocks that are bargains and strong buys, I look for companies that trade at a reduced forward P/E compared to their sector and have strong earnings growth.
Celestica (CLS)
Celestica (NYSE:CLS) is an electronics manufacturing company that primarily provides supply chain services and other cloud-based solutions for industries such as aerospace and defense, industrials, health care and communications.
Over the past year, investors have been flocking to this company in huge numbers. Its share price has risen by more than fourfold, mainly due to consistent earnings growth.
On April 24, CLS reported earnings for the first quarter of 2024, in which it stated that total revenue increased by 20% and net income rose by more than fourfold to $102 million year-over-year. Also in April, Celestica acquired an IT solutions company, NCS Global Services LLC, for approximately $36 million.
Celestica beat analyst expectations for earrings in Q1 2024, continuing its consistent cycle of increasing profitability.
Despite its massive share price growth over the last year, Celestica is still trading at a great margin for investors. Its forward P/E ratio is 14.56, while the sector average is 23.52. It is still a solid buy among investors seeking to get in on the huge run-up the company is experiencing.
General Motors (GM)
General Motors (NYSE:GM) is an automobile manufacturer that sells trucks, sedans, and SUVs under their brands, such as Chevrolet, Buick, GMC and Cadillac.
On Apr. 23, General Motors released its earnings for the first quarter of 2024, stating that total revenue increased by 8% and net income rose 26%.
GM also updated its guidance for the full year 2024, stating that net income is expected to be between $10.1 billion and $11.5 billion, compared to the previous guidance of $9.8 billion to $11.2 billion.
Over this past year, General Motors’ share price increased by 40% due to earnings growth that beat analysts’ expectations for the first quarter and revised guidance for the full year 2024.
General Motors is a great pick for investors due to its undervalued status. Its forward P/E ratio is 4.78 compared to the median sector forward P/E of 15.82.
It is a stock trading for a discount, strong earnings growth, and a double-digit increase in electric vehicle sales. GM is a strong buy for investors.
Comcast (CMCSA)
Comcast (NASDAQ:CMCSA) is a communication services company that offers users broadband and wireless connectivity services. It also provides media services such as its streaming platform Peacock and NBCUniversal, its television studio. Comcast also operates a theme park segment with Universal theme parks in China, Japan, California and Florida.
Over this past year, Comcast’s stock price has remained relatively unchanged, falling slightly by 1%. This makes it a stock that suits investors who seek income.
Comcast offers investors a solid dividend yield of 3.12% on an annual basis. Its most recent quarterly dividend was thirty-one cents per share.
On Apr. 25, Comcast released its earnings for the first quarter of 2024, stating that total revenue increased by 1%, net income remained practically unchanged, and free cash flow rose by 19% year over year.
Other notable highlights for the first quarter of 2024 include that paid subscribers among Peacock users increased by 55% compared to the first quarter of 2023. Within the first quarter, Comcast repurchased approximately $2.4 billion in total shares.
Comcast is also a solid value pick, with a forward P/E ratio of 9.42, compared to the median sector forward P/E of 13.49.
Comcast is a great income-generating company trading at a discount. CMCSA shares would be a great addition to any investor’s portfolio.
As of this writing, Noah Bolton did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
