Not very many stocks are trading near their 52-week lows today. Investors have been pretty bullish this year, mainly on tech stocks, but on other sectors, too. As a result, there aren’t many things out there that look like “bargains” at today’s levels.
Nevertheless, it is possible to find stocks trading at 52-week lows. They aren’t always the easiest to find, but if you turn over enough rocks you’ll find them. In this article, I will explore three stocks trading near 52-week lows that may be worth investing in today.
Cogeco
Cogeco inc (TSX: CGO) is a Quebec-based media and telecommunications company. It owns the largest cable company in Ontario, the biggest radio broadcaster in Quebec, and even some cable assets in the United States.
Cogeco stock has been beaten down badly this year. As a result, it is close to its 52-week low, which is $47.36.
Does Cogeco deserve its falling stock price, or is this a classic “deep value” situation unfolding before our eyes?
Well, the company’s most recent earnings release was pretty mediocre. In the third quarter, the company delivered:
- $767 million in revenue, up 1.7%.
- $355 million in adjusted EBITDA, up 0.6%.
- $33.3 million in net income, down 76%.
- A $34 million loss attributable to shareholders.
- A $2.22 loss per share.
Overall, the results were fairly poor; however, the net loss attributable to shareholders was mostly due to an $88 million goodwill impairment, a classic non-recurring non-cash charge. If you back that out, the company was profitable in the period.
NextEra Energy
Nextera Energy (NYSE: NEE) is a U.S. utility stock that is just barely above its 52-week low, which is $67.08. The company is involved in green energy, an important industry that the U.S. government is heavily subsidizing. NextEra Energy beat on earnings last quarter, and enjoys high growth rates in revenue, operating income, earnings, and cash flows. Utilities like NEE face some risks when interest rates rise, as is happening now. These businesses are extremely capital-intensive and debt-heavy, so many of them start losing money when rates go up. We saw that happen last year when Algonquin Power & Utilities suffered a big third quarter earnings miss – interest rates were partially to blame. However, with NEE’s earnings still going up on a 12-month basis, it appears to have avoided AQN’s fate.
Paypal
Paypal Inc (NASDAQ: PYPL) is a company that many readers will be familiar with. It’s the biggest payments company in the world by market cap, worth $67 billion. The company’s stock has fallen off a cliff thanks to a series of earnings releases that missed expectations. When Paypal’s relationship with eBay was terminated, the company lost a lucrative revenue source. Today, however, the company is starting to turn things around. It had positive growth in revenue and earnings in the trailing 12-month period, and also is seeing its return on equity increase rapidly.
Is Paypal stock a sure thing? Probably not. Ultimately, there is a lot of competition in the payments industry – competition isn’t a good thing for investors. Nevertheless, the company is doing well enough that its stock might have some upside.
