By: Dividend Sensei
The market is full of manias, from NFTs to SPACs, meme stocks, and crypto. The S&P 500 is 37% overvalued and analysts expect 0% returns over the next three years.
But blue-chip bargains always are available, even anti-bubbles, priced for negative growth despite objectively strong fundamentals.
This 8% yielding blue-chip is priced for about -1% perpetual growth, but analysts expect 3% to 8%. Management says it can grow at 7% to 9% and it has a plausible plan to get there.
This company is 51% undervalued, trading at 8X earnings, the lowest PE in 20 years. The last time it was this cheap, investors enjoyed 25% annual total returns for the next 15 years.
I’ve been buying steadily for over a year, totaling about 1,000 shares. And I plan to keep buying for as long as this Buffet-style fat pitch opportunity persists.