There are multiple investing strategies and one involves looking for unloved shares. With that in mind, I’ve found a handful of FTSE 100 stocks trading near 52-week lows worth considering now.
Sometimes shares fall for good reasons. But other times a company may simply drop out of favour with investors while the underlying business retains decent forward prospects.
And situations like that raise the possibility of keener valuations. So it can be a good idea to consider out-of-favour stocks. That’s because they may regain popularity with investors as their businesses perform well in the years ahead.
High dividend yields
Of the FTSE 100 stocks I’d research now, the first is sustainable technology company Johnson Matthey.
With the share price near 1,870p, it’s just under 5% up from its low of last October. But the shares have languished around this level for about a year-and-a-half now.
But City analysts expect earnings advances this year and next. And the forward-looking dividend yield for 2024 is running above 4%.
Meanwhile, second on my list for further investigation is paper and packaging supplier Mondi. The share price near 1,295p is just over 4% higher than its low in April.
However, after a plunge in earnings this year, analysts expect them to stabilise in 2024. But the dividend will likely be held roughly flat for both years. And the current forward-looking yield is around 4.5% for 2024.
And talking of decent yields, I can’t ignore smoking products business British American Tobacco. With the stock at 2,727p, it’s up just under 3% from its low in May.
And now the forward-looking yield for 2024 is running above 9%. Although the company did rebase its dividend lower in 2017 and there’s some risk the directors may do that again.
Nevertheless, I see this stock as well worth further and deeper research along with the others.
Mixed performance
But I’d also look at RS Group, the industrial and electronic products and solutions business. At 787p, the share price has hit a 52-week low. But at first glance, the performance of the business doesn’t appear to justify such a move.
City analysts expect a 25% hike in earnings this year followed by a drift of a couple of percentage points in 2024. Meanwhile, the forward-looking dividend yield for 2024 is just under 3%.
And the fifth and final stock I’ve singled out for deeper research is diversified mining company Anglo American.
With the stock price at 2,281p, it’s at its one-year low. And given that commodity prices have eased back in many cases, perhaps that’s not surprising.
However, on current analyst estimates, the anticipated dividend yield is running at just under 5.8% for 2024. And that makes the opportunity worthy of careful consideration and research.
Of course, there can be no guarantee that out-of-favour stocks will go on to deliver decent long-term returns for shareholders. All businesses can run into operational difficulties from time to time.
Nevertheless, lower share prices can sometimes cause keener valuations. And that can be a decent jumping-off point for further analysis and research.
