When a stock is trading near its 52-week low, that could be a good opportunity to buy low and potentially cash in when the share price recovers. However, that’s no small if, and there’s no guarantee that a stock won’t just continue to drop further in price.
Investing based solely on price is dangerous, but stocks with good fundamentals that are down in price could offer investors attractive returns.
The three stocks below are near their 52-week lows and are quality investments that could be great long-term buys. In addition, all of the shares offer great payouts that are now even higher as a result of their prices being lower.
Thomson Reuters Corp. (TSX:TRI)(NYSE:TRI) is trading a little more than $1 off its 52-week low, and in 2017 its share price has failed to gain any momentum with the stock declining more than 4% since January. The company provides news and information, and you might even notice the name pop up as you are researching stocks on various financial websites.
Thomson Reuters has struggled to show much growth with sales up less than 2% in its most recent quarter. However, the company has been able to produce reliable and consistent profits, despite the challenges it has faced.
Although many professionals and investors are being self-sufficient in their quest for information, Thomson Reuters still fills a void for many, and the trusted brand has proven it has a strong place in the industry. When a company is making over $11 billion in sales every year and it’s not a tech stock, it will be difficult to grow sales, regardless of the industry.
The stock has doubled in the past five years, and investors could still earn a decent return on this stock, while also collecting a solid dividend of more than 3% annually.
TransAlta Renewables Inc. (TSX:RNW) has declined more than 9% this year, and it hit a new 52-week low earlier this month. The stock offers a terrific 7.2% yield as a result of the decline, and it may not be as unsustainable as it looks.
As consumers demand more environmentally friendly sources of energy, renewable energy providers could see tremendous growth opportunities in the long term. Although the company posted a loss in its recent quarter, sales more than doubled, and that could be just the beginning for TransAlta.
Corus Entertainment Inc. (TSX:CJR.B) has also had a rough year with its stock declining more than 8% in 2017 and reaching a new 52-week low back in November. The media company had a strong dividend before, and with the drop in price, investors are now being paid nearly 10% per year.
Although this is yet another high dividend, investors shouldn’t be scared away, as the company’s free cash flow can support the dividend payments. Corus failed to impress investors with its most recent results showing no sales growth, but the company was able to produce an improved bottom line.
Corus owns several channels, including History, HGTV, Global Television, and many others. With online streaming becoming more and more popular, the company could see many opportunities to grow its business.
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Fool contributor David Jagielski has no position in any stocks mentioned.