For years, analysts and portfolio managers have anticipated the return of value stocks as the market moved higher. And for years, value stocks have continued to underperform growth stocks. However, that appears to be changing in 2022, as almost every metric from valuations to earnings for the growth arena have started to roll over.
Value stocks are typically defined as shares of a company with solid fundamentals that are priced below those of its peers, based on analysis of price-to-earnings ratio, yield and other factors. The BofA Securities Value 10 portfolio is quantitatively generated and is based on the firm’s proprietary BofA Securities versus consensus earnings surprise model plus three additional screening criteria. The universe the analysts use is the S&P 500.
We screened the Value 10 portfolio for the five stocks with the highest dividends. These top picks could be big second-half of 2022 winners. While all are rated Buy at BofA Securities, it is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Exelon
This top utility stock also makes good sense now for conservative investors. Exelon Corp. (NYSE: EXC) engages in the energy generation, delivery, and marketing businesses in the United States and Canada. It owns nuclear, fossil, wind, hydroelectric, biomass and solar generating facilities.
The company also sells electricity to wholesale and retail customers, and it sells natural gas, renewable energy and other energyelated products and services. Furthermore, it is involved in the purchase and regulated retail sale of electricity and natural gas, as well as the transmission and distribution of electricity and distribution of natural gas to retail customers.
The company also offers support services, including legal, human resources, information technology, financial, supply management, accounting, engineering, customer operations, distribution and transmission planning, asset management, system operations and power procurement services. It serves distribution utilities, municipalities, cooperatives and financial institutions, as well as commercial, industrial, governmental and residential customers.
Exelon stock investors receive a 3.12% dividend. BofA Securities has a $54 target price on the shares, and the consensus target is $49.29. The stock ended Monday’s trading at $43.89 apiece.
Hartford Financial Services
This insurance giant is a dependable idea for conservative investors, and it offers incredible value at current trading levels. Hartford Financial Services Group Inc. (NYSE: HIG) provides insurance and financial services to individual and business customers in the United States, the United Kingdom and elsewhere.
Its Commercial Lines segment offers workers’ compensation, property, automobile, liability, umbrella, bond, marine, livestock and reinsurance, as well as customized insurance products and risk management services, including professional liability, bond, surety and specialty casualty coverages through regional offices, branches, sales and policyholder service centers, independent retail agents and brokers, wholesale agents and reinsurance brokers.
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