Eleven Deals for Under $10
THE S&P IS ON SALE, AND THERE ARE BARGAINS TO BE had among the stock market’s lowest-priced issues. To find them, Barron’s first screened the Standard & Poor’s 500 for stocks trading below $10 a share — a group that currently numbers roughly 80 issues, or 16% of the index. Most are down more than 50% this year, amid the worst bear market in years.
To separate the potentially troubled from the merely cheap, we then screened for companies likely to increase earnings per share — even if only by a penny — in 2009. And, to weed out the dangerously debt-encumbered, we looked for companies with long-term obligations of less than 50% of total capitalization. You’ll find the “survivors” — an eclectic 11 — listed nearby.
The list contains four telecommunications and technology stocks: Motorola , Tellabs, Compuware and Jabil Circuit. It also includes two food-related issues — poultry producer Tyson Foods and Starbucks — and a healthcare play, Boston Scientific. Genworth, a financial-services concern spun out of General Electric (ticker:GE) in 2004, at a far loftier $19.50 a share, makes the cut, as well, along with former highflier Southwest Airlines. Rounding out the group are Eastman Kodak and Interpublic Group, the advertising agency.