How many times in the last few weeks have you been told that the banks’ shares are dirt cheap? The relative valuations of most banks, as gauged by their price-to-tangible book value and price-to-earnings ratios, offer a very attractive entry point, many observers argue. Moreover, the shares of certain banks could be a bargain because they trade are at much lower levels compared to post-credit crunch highs, although developed economies have healed. I have been stuck with a bank stock for about six years. Not only had I bought it at a 50% discount vs its previous high,…
Banks And Miners
Elsewhere, I have heard bullish comments about the mining sector — it’s cheap, trading multiples are low, it offers compelling value — so now I am going to tell you why neither the banks nor miners are likely to deliver terrific returns for some time.
Betting On A Bounce
There are always alternatives, though, and I think this is a must-read for dedicated devotees of dividends, who can achieve outstanding returns with just a bit of risk. In our FREE report, we have included a defensive stock that has struggled in recent times, but offers both capital gains and yield -- its one-month performance is -6%; two-year performance is +14%; and five-year performance is +60%!
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Alessandro Pasetti has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.