The S&P 500 has remained relatively unimpressive this year, leading to investors searching for bargain stocks to round out their portfolios. Three bargain stocks to consider as of June 20, 2016 are:
1. General Motors (GM)
General Motors offers a 5.23% dividend yield and declared its first dividend after going bankrupt in January 2014. GM has raised its dividend twice since then, despite the company’s stock price falling 27% over the same period.
The company’s drop in stock price doesn’t reflect its strong last quarter. The company broke even in the European market while remaining profitable in North America. GM also aims for $6 billion in free cash flow by the end of the year.
2. Western Digital (WDC)
Western Digital is one of the world’s leading hard-drive manufacturers, but the company has struggled this year, falling nearly 50%. Western Digital’s price-to-earnings ratio has been high for years and remains at 13, which is far lower than the broader market now.
The company’s 4.27% dividend yield is a major selling point for the company.
Falling PC sales are expected to level out over the next three years, which is good news for a company intimately tied to the PC market. The company purchased SanDisk in an attempt to diversify its products.
Nearly 66% of the company’s revenue now comes from sources other than PC, and the SanDisk purchase will have a direct impact on the company’s sales to the tune of a 30% increase.
3. Intel (INTC)
Intel is another business that is closely tied to falling PC sales. The company has remained relatively unchanged over the past year, but its revenue has jumped 7% to $13.7 billion, with net income up 3% to $2 billion.
The company is positioned for a major rise in revenue when the PC market rebounds, and in the meantime, Intel offers a 3.25% dividend yield to investors.