4 Dirt-Cheap Value Stocks I’ve Been Buying This Year

Lately, I have been buying cheap stocks like Toronto-Dominion Bank (TSX:TD).

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In 2023, I have been buying stocks. For the most part, I haven’t been buying as many as I did in 2022, as I’m putting more of my money into term deposits now. However, I have been able to add some individual stocks to my portfolio at acceptable prices at various points this year. In this article, I will explore four of them.

Toronto-Dominion Bank

Toronto-Dominion Bank (TSX:TD) is a Canadian bank stock that I’ve been buying and holding for several years. I only added to my position in TD very slightly this year, but I plan to add more if the stock dips.

I’ve written what I like about TD Bank stock many times in the past. The stock is relatively cheap, the company’s earnings are growing, and the bank has a large U.S. presence that it recently added to by buying out Cowen. TD Bank is a great company that should continue doing big things in the future.

Bank of America

Bank of America (NYSE:BAC) is one stock that really puts the “cheap” in “dirt cheap.” This stock trades for less than its book value, meaning that when you buy it, you’re technically getting less than what you pay for. Now, there are some caveats here. BAC has about $99 billion worth of unrealized losses on securities, but those aren’t reported as part of book value. If you subtract the unrealized losses from book value, then you get a price/book ratio slightly higher than one, which is definitely still cheap.

At any rate, Bank of America has been performing well lately as a company. In its most recent quarter, it did 13% growth in revenue and 15% growth in earnings. The growth figures were a little behind those of other large U.S. banks but still pretty good.

Taiwan Semiconductor

Taiwan Semiconductor Manufacturing (NYSE:TSM) is a Taiwanese stock that I just started adding to my portfolio this year. It is a gigantic company that controls 60% of the global semiconductor manufacturing market. It assembles chips for virtually all of the big U.S. tech companies.

Most semiconductor companies are seeing their earnings go down this year, but TSM’s earnings are actually rising in its own native currency, the Taiwan dollar. The company’s earnings are going down when reported in U.S. dollars, but not by a whole lot. Overall, it’s the best-performing semiconductor company in 2023.

Pinduoduo

PDD Holdings (NASDAQ:PDD) is one of the smaller positions in my portfolio. It’s a Chinese e-commerce company whose growth has been phenomenal lately. Over the last year, the company grew its revenue by 38%, its earnings by 300%, and its operating cash flow by 30.5%.

In the most recent quarter, the revenue growth accelerated to 46%. The company is also very profitable, with a 29.6% free cash flow margin and a 24.16% net income margin. If you’ve ever found yourself shopping for bargains on the new shopping app Temu, PDD Holdings is the company you’re buying from. It’s a real growth opportunity that’s just getting started. Yet it trades at a mere 16 times earnings!

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Bank of America is an advertising partner of The Ascent, a Motley Fool company. Fool contributor Andrew Button has positions in Toronto-Dominion Bank, Bank of America, Pinduoduo and Taiwan Semiconductor Manufacturing. The Motley Fool recommends Bank of America and Taiwan Semiconductor Manufacturing. The Motley Fool has a disclosure policy.

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