Value-oriented investors have been having a tougher time finding deals out there amid such a strong bull run in the markets over the course of 2019. But there are still good deals to be found in this market if you know where to look or have someone looking for you. For example, here are two stocks that could prove to be bargain buys today.
1. TD Bank: Strong fundamentals and a bargain P/E
Toronto-Dominion Bank (NYSE:TD) is coming off a less-than-exciting quarterly result where it disappointed investors by missing expectations. In the fourth quarter, the big Canadian bank’s expenses crept up, chipping away at the company’s bottom line. Adjusted earnings per share of 1.59 Canadian dollars during the quarter fell well short of the CA$1.74 that analysts were anticipating. A key reason behind the disappointing results is that TD’s provision for credit losses increased by 28.5%, reaching CA$891 million.
With concerns about the economy on the rise, credit losses being up are sure to put investors on edge. And so it’s no surprise that the bank is down as a result of earnings, and its year-to-date returns are a modest 9% thus far. But there’s little reason for investors to be worried about TD’s long-term future, as the company is one of the top chartered banks in Canada with a significant presence in the U.S. as well.
The bank may have missed earnings expectations, but its fundamentals remain strong, and there’s a lot to like about the stock. For one thing, it’s really cheap. Trading at less than 12 times price-to-earnings (P/E), TD is on the bargain side, as the stock has normally traded a bit higher in prior years, normally around a P/E of 13.
It may not be a big discount, but it’s also not a stock that’s likely to slump to a P/E of less than 10, either. Regardless of the outlook for the Canadian and U.S. markets, TD just isn’t a risky enough stock to fall to a low valuation for a prolonged period. That’s why buying the stock even at a P/E of 12 could be a good bargain for investors — especially with the company now paying a dividend yield north of 4%.
2. Fresenius Medical Care
Fresenius Medical Care (NYSE:FMS) provides products and services that assist people who are struggling with chronic kidney failure. With operations in over 20 countries and serving more than 340,000 patients, the German-based company can give investors… Continue reading at The Motley Fool