Value stocks

ASX value stocks with returns of 3% or more

A value stock is a stock that trades on the stock exchange at a lower price than its fundamentals suggest. The price of such a stock reflects market sentiments. But these stocks are known to have the potential to generate a better return.

Value stocks come with a high dividend yield, a price below book value, and a low price-to-earnings (PE) ratio.

(High-dividend stocks are not always good. A stock’s dividend yield may be higher due to a significant decline in its stock price, implying financial difficulties that could affect its ability to pay future dividends.)

Here are four actions listed value on the ASX with dividend yields of 3% or more.

Growthpoint Properties Australia Ltd (ASX: GOZ)

Growthpoint Properties Australia is a REIT which invests in properties in the office, industrial and retail sectors across Australia.

GOZ has an m-cap of A$3.11 billion with a P/E ratio of 5.63. The company has a dividend yield of over 5%. As of 12:20 p.m. (AEST), the stock was trading at AU$4.02, down 0.37%.

The distribution for the six months ending December 31, 2021 was 10.4 cents per share (cps). In its latest business update, the company updated its FY22 distribution forecast from 20.6 cps to 20.8 cps, up 4.0% from FY21.

The group updated its funds from operations (FFO) guidance to at least 27 cps for FY22, indicating minimal growth of 5.1% year on year.

Ambertech Ltd (ASX: AMO)

Ambertech distributes audio-visual solutions in Australia and New Zealand for all types of installation projects.

AMO has an m-cap of A$29.75 million with a P/E ratio of 4.89. The company has a dividend yield of over 9%. AMO is a penny stock. As of 12:20 p.m. (AEST), it was trading at AU$0.32, up 1.56%. Since penny stocks carry high risk, one should do some research before exposing yourself to them.

In FY21, the company’s revenue from ordinary activities increased by 36.5% over the prior corresponding period to reach A$80.14 million. At the same time, after-tax profit attributable to members improved by more than 549%.

Virus Health Ltd (ASX: VRT)

VRT is engaged in providing assisted reproduction services.

VRT has an m-cap of A$626.13 million with a P/E ratio of 13.73. The company has a dividend yield of over 3%. As of 12:20 p.m. (AEST), the stock was trading at AU$7.30, down 0.27%.

Over the past three years, the company has increased its revenue from AU$263.92 million to AU$324.60 million. It also increased its net profit by almost 40% during the same period.

Michael Hill International Ltd. (ASX: MHJ)

Michael Hill is a multi-channel jewelry chain that operates globally. It has a range of stores as well as a digital platform in Australia, Canada and New Zealand.

MHJ has an m-cap of A$545.54 million with a P/E ratio of 12.04. The company has a dividend yield of almost 3%. As of 12:20 p.m. (AEST), the stock was trading at AU$1.40, down 0.36%.

At the same time, the company announced a 9.8% increase in sales for all Group stores for the period ended December 26, 2020 despite 2,381 lost business days. Same-store sales increased 9.6% over the prior year. The company expects 1HFY22 earnings before interest and tax (EBIT) of A$49 million to A$53 million, compared to A$44.6 million in 1HFY21.

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