Latest news with #dividendyield
Yahoo
20 hours ago
- Business
- Yahoo
3 Dirt Cheap Stocks to Buy With $500 Right Now
Key Points Alphabet trades at a much cheaper valuation than its Magnificent Seven peers. Realty Income's low valuation is a big driver of its high dividend yield. Energy Transfer trades at one of the lowest valuations in its peer group. 10 stocks we like better than Alphabet › Following a brief dip earlier this year driven by tariff concerns, the S&P 500 has resumed its rally as those fears faded. As a result, we now find the broad market index fetching nearly 22 times its forward earnings. This level is nearing its highest points in the past quarter-century. Even in today's pricier market, several stocks trade at dirt cheap levels. Realty Income (NYSE: O), Energy Transfer (NYSE: ET), and Alphabet (NASDAQ: GOOG)(NASDAQ: GOOGL) stand out as very inexpensive stocks. For anyone with $500 to invest, these stocks make compelling buys right now. An AI bargain Tech titan Alphabet trades at the lowest valuation in the "Magnificent Seven," at around 19 times forward earnings. That's dirt cheap compared with those super growth stocks, which fetch more than 27 times forward earnings. What's holding back Alphabet's valuation? Concerns about AI's impact on its lucrative search business. However, as of the first quarter, AI chatbots have not dented its advertising revenue. Google's search revenue actually climbed 10% in the period, to almost $51 billion. Instead, the company is benefiting from AI. CEO Sundar Pichai stated in the first-quarter earnings release, "Search saw continued strong growth, boosted by the engagement we're seeing with features like AI Overviews, which now has 1.5 billion users per month." The company also recently rolled out its Gemini 2.5 AI model, which "is achieving breakthroughs in performance and is an extraordinary foundation for our future innovation," according to Pichai. The company is also expanding its other businesses, including Google Cloud, YouTube, and others. Alphabet's long-term growth potential makes it look like an especially attractive investment these days. A dirt cheap REIT As a leading real estate investment trust (REIT), Realty Income boasts a diversified portfolio that delivers stable rental income through long-term net leases. Management expects to generate between $4.22 and $4.28 per share of adjusted funds from operations (FFO) this year. With shares of the REIT recently trading below $57, the stock sells for less than 13.5 times its forward earnings. This bargain price is why it offers an attractive dividend yield of more than 5.5%. Rising interest rates have presented some headwinds for REITs such as Realty Income, making it more expensive to borrow money for new investments. Nevertheless, Realty Income continues its steady growth. The company made $1.4 billion worth of acquisitions in the first quarter, enabling it to raise its monthly dividend several times this year. Realty Income projects it will have the financial capacity to invest about $4 billion in portfolio expansion this year. If interest rates fall, which many expect will eventually happen, Realty Income would be able to make even more acquisitions. That would allow it to grow faster, which should boost its valuation. A bottom-of-the-barrel valuation Energy Transfer is one of the country's largest master limited partnerships (MLPs). The midstream company owns a large and diverse portfolio of energy infrastructure assets, such as pipelines, processing plants, storage terminals, and export facilities. Those assets generate stable cash flow, with 90% coming from fee-based structures. Despite its stable cash flow profile, Energy Transfer currently trades at the second-lowest valuation in its peer group. That's a big reasonit boasts a monster 7.5% distribution yield. Other than the fact that the MLP sends investors a Schedule K-1 federal tax form each year, there's no reason for Energy Transfer's discounted valuation. The MLP is in its strongest financial position in history, with a leverage ratio in the lower half of its target range. It also has a low distribution payout ratio, at less than half of its stable cash flow. Meanwhile, it's growing at a solid rate, with a reacceleration expected in 2026 and 2027 as it benefits from a slew of upcoming project completions. The growth from those projects will give it plenty of fuel to continue increasing its high-yielding distribution. Cheap stocks in a pricy market While the S&P 500's valuation is rising to expensive levels, there are still some very reasonably priced stocks out there worth buying. Alphabet, Realty Income, and Energy Transfer currently trade at dirt cheap valuations. With solid growth prospects despite some headwinds, they're great stocks to buy right now for those who have around $500 to invest. Should you invest $1,000 in Alphabet right now? Before you buy stock in Alphabet, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Alphabet wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $652,133!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,056,790!* Now, it's worth noting Stock Advisor's total average return is 1,048% — a market-crushing outperformance compared to 180% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of July 21, 2025 Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Matt DiLallo has positions in Alphabet, Energy Transfer, and Realty Income. The Motley Fool has positions in and recommends Alphabet and Realty Income. The Motley Fool has a disclosure policy. 3 Dirt Cheap Stocks to Buy With $500 Right Now was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
20 hours ago
- Business
- Yahoo
What Halal Investors Should Know About PepsiCo (PEP)
PepsiCo, Inc. (NASDAQ:PEP) is included among the 11 Best Halal Dividend Stocks to Buy Now. A close up of a glass of a refreshing carbonated beverage illustrating the company's different beverages. The company recently reported its Q2 2025 earnings, with revenues of $22.7 billion, up 1% from the same period last year. It maintained strong momentum in its international operations, while its North American businesses showed improved execution and strengthened their competitiveness in important subcategories and distribution channels. PepsiCo, Inc. (NASDAQ:PEP) projects a modest rise in organic revenue for 2025, with core earnings per share remaining steady on a constant-currency basis. The company plans to return around $8.6 billion to shareholders, including $7.6 billion in dividends and $1 billion through share buybacks. PepsiCo, Inc. (NASDAQ:PEP) is a Dividend King, as the company has raised its payouts for 53 years in a row. The company offers a quarterly dividend of $1.4225 per share and has a dividend yield of 3.97%, as of July 17. While we acknowledge the potential of PEP as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: and . Disclosure: None. Sign in to access your portfolio
Yahoo
21 hours ago
- Business
- Yahoo
Is Texas Instruments (TXN) a Halal Dividend Stock for Tech-Savvy Investors?
Texas Instruments Incorporated (NASDAQ:TXN) is included among the 11 Best Halal Dividend Stocks to Buy Now. A robotic arm in the process of assembling a complex circuit board - showing the industrial scale the company operates at. On July 18, the company declared a quarterly dividend of $1.36 per share, which was in line with its previous dividend. It has been growing its payouts for 21 consecutive years. The stock supports a dividend yield of 2.51%, as of July 18. Texas Instruments Incorporated (NASDAQ:TXN)'s cash position showed the strength of its dividend. The company's operating cash flow over the past 12 months totaled $6.2 billion, highlighting the strength of its business model, the quality of its product offerings, and the advantages of 300mm production. Free cash flow during the same period amounted to $1.7 billion. Over the past year, the company allocated $3.8 billion to research and development and selling, general, and administrative expenses, invested $4.7 billion in capital expenditures, and returned $6.4 billion to shareholders. Texas Instruments Incorporated (NASDAQ:TXN) operates with a solid business model focused on analog and embedded processing solutions, backed by durable competitive advantages. A central aspect of its long-term strategy for growing free cash flow per share is its disciplined capital allocation. This involves selectively funding R&D initiatives, expanding capabilities, investing in manufacturing infrastructure, considering strategic acquisitions, and consistently returning value to shareholders. While we acknowledge the potential of TXN as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: and . Disclosure: None. Sign in to access your portfolio
Yahoo
a day ago
- Business
- Yahoo
Can the BP share price reach £5? Here's what needs to happen
Over the past year, the BP (LSE:BP.) share price has slid by around 11%. The loss for shareholders has been offset by its impressive dividend yield. And over the last few months, this downward trajectory did start to change course, with the shares of this oil giant rising by almost 20% since April. [fool_stoc_chart ticker=LSE:BP.] As a result, the energy stock is now trading around £4 per share. Yet if the analyst team at Barclays is correct in its convictions, this price may rise to as high as £5.25 by this time next year. So, what's behind this bullish stance? And what needs to happen for BP shares to rise to this level? Investigating performance requirements At the heart of Barclays' analysis lies BP's massive strategic reset that was unveiled in early 2025. The pivot away from renewables and back towards traditional fossil fuels means production volumes are expected to rise as high as 2.5m barrels of oil equivalent per day (boepd) by 2030. At the same time, the forecast assumes that management will succeed in hitting its target 16% return on capital by 2027, and that the compounded annual growth rate of free cash flow will exceed 20% between 2024 and 2027. The latter comes paired with the assumption that BP will also deliver up to $5bn of structural annual savings by 2027, and that net debt falls from $27bn today to a target of $18bn over the same time period. Needless to say, the journey to £5 a share is highly conditional, and many of the required feats are far easier said than done. Having said that, there are some early signs of progress towards these various goals. The progress so far The first half of 2025 has seen some encouraging steps forward. While unpleasant for employees, the company has successfully reduced its required workforce by 5% and hit pause on many low-return projects. These moves have translated into record operating efficiency. At the same time, up to $4bn of capital is expected to be raised by the end of this year courtesy of its divestment plan. The proceeds are intended to be reinvested as well as being used to pay down debts. And with three new project starts in the first quarter, along with six additional discoveries, BP also seems to be making progress towards ramping up production volumes. Not everything is going smoothly Suppose BP can continue to post encouraging results? In that case, improved investor sentiment may be capable of pushing its share price above the £5 threshold. However, some upcoming headwinds could prove challenging. Despite launching new projects, the disposal of existing ones in Egypt and Trinidad has actually pushed first-quarter production in the wrong direction. At the same time, oil & gas prices are proving to be quite volatile this year, with uncertainty brewing as a result of conflicts in the Middle East. This could compromise the predictability of cash flows, making it harder for management to allocate capital effectively. So, should production volumes and fossil fuel prices continue to fall in the short term, the BP share price could do the same. All things considered, I think it's still too soon to determine whether management can deliver on its promises within its specified timeframe. And with potential selling catalysts on the horizon, investors may want to think about sitting on the sidelines for now. The post Can the BP share price reach £5? Here's what needs to happen appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Zaven Boyrazian has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025
Yahoo
a day ago
- Automotive
- Yahoo
Returns On Capital Are Showing Encouraging Signs At General Motors (NYSE:GM)
If we want to find a stock that could multiply over the long term, what are the underlying trends we should look for? Firstly, we'll want to see a proven return on capital employed (ROCE) that is increasing, and secondly, an expanding base of capital employed. Basically this means that a company has profitable initiatives that it can continue to reinvest in, which is a trait of a compounding machine. So when we looked at General Motors (NYSE:GM) and its trend of ROCE, we really liked what we saw. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. Return On Capital Employed (ROCE): What Is It? For those that aren't sure what ROCE is, it measures the amount of pre-tax profits a company can generate from the capital employed in its business. The formula for this calculation on General Motors is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) 0.064 = US$12b ÷ (US$282b - US$91b) (Based on the trailing twelve months to March 2025). So, General Motors has an ROCE of 6.4%. Even though it's in line with the industry average of 6.3%, it's still a low return by itself. Check out our latest analysis for General Motors In the above chart we have measured General Motors' prior ROCE against its prior performance, but the future is arguably more important. If you'd like to see what analysts are forecasting going forward, you should check out our free analyst report for General Motors . What Does the ROCE Trend For General Motors Tell Us? We're glad to see that ROCE is heading in the right direction, even if it is still low at the moment. The numbers show that in the last five years, the returns generated on capital employed have grown considerably to 6.4%. Basically the business is earning more per dollar of capital invested and in addition to that, 23% more capital is being employed now too. This can indicate that there's plenty of opportunities to invest capital internally and at ever higher rates, a combination that's common among multi-baggers. The Bottom Line On General Motors' ROCE In summary, it's great to see that General Motors can compound returns by consistently reinvesting capital at increasing rates of return, because these are some of the key ingredients of those highly sought after multi-baggers. Since the stock has returned a staggering 105% to shareholders over the last five years, it looks like investors are recognizing these changes. With that being said, we still think the promising fundamentals mean the company deserves some further due diligence. If you'd like to know more about General Motors, we've spotted 2 warning signs, and 1 of them is potentially serious. While General Motors isn't earning the highest return, check out this free list of companies that are earning high returns on equity with solid balance sheets. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
