As self-investors know, finding the right stock at the right price can be a grueling task, and it can seem nearly impossible to find a stock that can provide both growth and dividend income. In order to make things very easy for you, I have done the hard part and found three dividend-paying stocks that are trading at inexpensive forward valuations compared with their five-year averages, so let’s take a closer look at each to determine which would be the best fit for your portfolio.
1. Manitoba Telecom Services Inc.
Manitoba Telecom Services Inc. (TSX:MBT) is the fourth-largest communications provider in Canada. At today’s levels, its stock trades at 23.6 times fiscal 2015’s estimated earnings per share of $1.24 and 19.7 times fiscal 2016’s estimated earnings per share of $1.49, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 34.4. Also, the company pays a quarterly dividend $0.325 per share, or $1.30 per share annually, giving its stock a 4.4% yield.
2. Cascades Inc.
Cascades Inc. (TSX: CAS) is the largest recycled paper collector in Canada and is a leader in the production and conversion of corrugated products, tissue paper, and specialty products in North America. At current levels, its stock trades at 9.8 times fiscal 2015’s estimated earnings per share of $0.77 and 7.8 times fiscal 2016’s estimated earnings per share of $0.96, both of which are inexpensive compared with its five-year average price-to-earnings multiple of 82.4. Additionally, the company pays a quarterly dividend of $0.04 per share, or $0.16 per share annually, which gives its stock a 2.1% yield.
3. Pason Systems Inc.
Pason Systems Inc. (TSX: PSI) is one of the world’s leading providers of specialized data management systems for drilling rigs. At today’s levels, its stock trades at 108.9 times fiscal 2015’s estimated earnings per share of $0.18 and 25.1 times fiscal 2016’s estimated earnings per share of $0.78, the latter of which is inexpensive compared with its five-year average price-to-earnings multiple of 40.6. In addition, the company pays a quarterly dividend of $0.17 per share, or $0.68 per share annually, giving its stock a 3.5% yield.
Could your portfolio use a growth and income stock?
Manitoba Telecom Services, Cascades, and Pason Systems are three very inexpensive investment options. Foolish investors should take a closer look and consider initiating positions in one of them today.
