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15 cheap stock picks to buy for big buybacks, dividends

    • 1929 posts
    May 27, 2020 5:49 AM EDT
    David Kostin, the chief US equity strategist at Goldman Sachs, says he's
    brought together a group of S&P 500 stocks that return double the
    average company in the broader index. Kostin adds that the stocks have
    underperformed the index for the last few years despite their superior
    returns. The performance of those stocks has steadily gotten worse as
    investors got more optimistic about economic growth.Visit Business
    Insider's homepage for more stories.It's a rare combination, but Goldman
    Sachs says you can get better-than-average returns from a few stocks
    while also buying them at better-than-average prices.To get more news
    about WikiFX, you can visit WikiFX news official website.

      David Kostin, chief US equity strategist at Goldman Sachs, says
    he's identified a group of stocks that more than double the cash return
    of the median S&P 500 stock, which is currently 4.4%. Most of them
    pay hefty dividends, and some augment that by repurchasing large amounts
    of their stock every year.And yet Kostin says those stocks have been
    collectively underperforming the S&P 500, as shown in the chart
    below. It shows the high-return stocks falling farther and farther
    behind the benchmark index over the last three years, with a few
    attempted rallies that didn't last long.Put simply, these stocks that
    offer strong cash distributions can be found at a bargain.

    David Kostin of Goldman Sachs says stocks that offer outsize cash returns have underperformed the S&P 500 for years.

      Goldman Sachs Global Investment Research

      And most recently, they've gotten even cheaper relative to the
    market as investors got more optimistic about the economy and resumed
    their preference for growth over higher-yielding stocks.

      Listed below are Kostin's top 15 stocks. They're ranked from
    lowest to highest based on their yield, defined as dividend payouts and
    stock buybacks as a percentage of their market caps over the past 12
    months.