How investors define what comprises a value stock may be up for debate. However, the search for value is always on among most investors. Accordingly, finding top value stocks to include in one’s portfolio is a goal many have.
However, in this market, there are few great deals available. Valuations remain elevated, despite the recent market volatility we’ve seen. Accordingly, it can be difficult to differentiate between a value stock and a value trap right now.
That said, here are three of my top picks for investors seeking value right now.
Top value stocks: SmartCentres REIT
SmartCentres REIT (TSX:SRU.UN) is one of the biggest fully integrated real estate investment trusts in Canada. It boasts a best-in-class portfolio with 174 strategically situated properties across the nation.
The company’s assets are worth approximately $11.3 billion. This trust is also the owner of income-generating, value-oriented retail and first-class office space. Currently, SmartCentres has amassed more than 34 million square feet of such properties. These are based on 3,500 acres of owned land in Canada, with an occupancy rate of more than 97%.
Currently, SmartCentres pays out a dividend yield of 5.8% and trades at under six times earnings.
Alimentation Couche-Tard
Alimentation Couche-Tard (TSX:ATD) is a top player in global fuel and convenience retail. In fact, Couche-Tard operates in 26 nations and territories, boasting around 14,200 stores. Approximately 10,800 of these locations provide road transportation fuel.
With its well renowned Circle K and Couche-Tard banners, this company is one of the biggest independent convenience store operators in the United States. Also, the company is a stellar player in the road transportation fuel retail and convenience store industry in the Baltics, Ireland, Canada, and Scandinavia.
Like the other companies on this list, Couche-Tard’s valuation is very attractive. The company currently trades at around 16 times earnings.
Manulife
Finally, we have top insurance company Manulife (TSX:MFC)(NYSE:MFC). This company’s valuation is similarly attractive, with MFC stock trading at around seven times earnings.
Additionally, like these other top players, Manulife’s business model is strong. The insurance industry is one that provides relatively predictable cash flows over time. Barring any sort of catastrophic event, Manulife stands to earn a reasonable return over time.
This insurance company has continued to pass on its earnings to shareholders in the form of dividends. Recently, the company hiked its dividend further. This has taken Manulife’s yield to a whopping 5.1% — a heck of a lot better than where bond yields are today.
For long-term investors, each of these three companies provide excellent value and long-term capital-appreciation upside.
