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3 Great Value Stocks for a Hot Market

By U.S. News & World Report

Since the election in early November, stocks have surged ahead with the Standard & Poor’s 500 index shooting up 12.8 percent and the Dow Jones industrial average up 14.6 percent. Last Wednesday’s Federal Reserve decision to begin winding down its $4.5 trillion balance sheet has spurred further bullish sentiment among investors. With U.S. stock markets now at or near all-time highs, is there still good value to be found?

Value investing as an investment discipline is not a set of hard-and-fast rules. Rather, it is a set of principles that have been laid down over time by some of the world’s greatest investors.

[See: 9 Ways to Buy Stocks That Everyone Needs.]

The screen: We used the Recognia Value Analyzer to look for companies matching the following value investing principles:

— A long-term track record of growing revenue and earnings per share. Rather than being concerned with the last quarter’s earnings, value investors wish to invest in companies that have displayed a long-term (10 years or more) history of growing their businesses.

— Low debt. Debt becomes a drag on a company’s earnings — especially in the environment of increasing interest rates.

— Companies that pay a dividend and ideally have a strong track record of increasing their dividend payouts over time.

— Consistent numbers of shares outstanding. Each time a company issues new shares, it dilutes the equity of existing shareholders. This analysis will avoid companies that are constantly issuing new shares.

— Companies that trade below their fair value. Fair value is a concept with many definitions. One methodology is to look for stocks whose price-earnings ratio is equal or less than its historic EPS growth rate. This definition makes intuitive sense as investors should be willing to pay more for a stock which is enjoying a higher rate of earnings growth.

Although the above are by no means an all-inclusive shopping list for value investors, they do form a useful starting point to screen for good value stocks.

[See: How to Invest in Esports: 7 Winning Stocks.]

McKesson Corp. (ticker: MCK). This San Francisco-based company is a great example of a value stock with a growing dividend, low debt and long track record of growing revenue and earnings. McKesson specializes in health information technology, medical supplies and care management tools. McKesson’s stock price faltered in mid-2016 as uncertainty about the U.S. election led to a decline in many health care stocks. However, the stock price has rallied in 2017 especially in the past two weeks. On May 18, McKesson announce fourth-quarter results which beat analysts’ estimates for earnings by a wide margin. The stock responded by shooting higher almost 15 percent.

Tanger Factory Outlet Centers (SKT). A real-estate investment trust, SKT also makes the list based on long-term, consistent revenue growth and advancing dividend yield. Tanger’s stock price was hit hard in the past 12 months (down 25 percent) due mainly to pressure on the REIT sector caused by expectations of increasing interest rates. At the same time, struggles by big name retailers like Sears and Macy’s have created a malaise over the entire retail sector. Tanger is now trading at less than its fair value for the first time in 10 years.

Bank of the Ozarks (OZRK). The financial services sector currently has a large number of companies making the value screen. One of the most interesting is this regional player. The company currently has more than 250 locations, mainly in Arkansas, Texas, Georgia and North and South Carolina. Like many companies in the banking space, Bank of the Ozarks stock shot up following the election on hopes of decreased regulation and increasing interest rates. Tempered optimism about the rate at which interest rates will rise has caused some pullback in the company stock price in recent months with the stock now trading about 20 percent off its 52-week highs.

[See: 10 Ways for Investors to Buy the Market.]

The investment ideas presented here are for information only. They do not constitute advice or a recommendation by Recognia Inc. in respect of the investment in financial instruments. Investors should conduct further research before investing.

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3 Great Value Stocks for a Hot Market originally appeared on usnews.com

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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