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6% dividend yields and dirt-cheap P/E ratios! I think these stocks are great 2020 ISA buys

Any dip buyer worth their salt needs to pay Centamin (LSE: CEY) some seriously close attention. The share price has receded 23% over the past two months in reaction to gold prices stagnating around $1,500 per ounce. In my opinion, the market’s been a bit too hasty in heading for the exits, as the outlook for bullion prices in 2020 remains robust.

There’s a broad selection of geopolitical and macroeconomic hurdles facing the global economy now and over the next couple of years, and fresh rate cuts from the US Federal Reserve last week suggest plenty of support for gold in 2020.

Monetary loosening all over the world has pushed metal prices to multi-year highs in 2019. The issue of further critical reductions from the US central bank appears to be more a question of ‘when’ than ‘if’, promising a ripple effect across the globe. Plenty of scope for Centamin’s share price to rebound, then.

The mining giant’s price-to-equity ratio of 16.6 times for 2020 sits above the accepted benchmark of 15 times, which suggests decent value for money. But in the context of the 43% profits jump City analysts expect for next year, and a subsequent sub-1 forward price to earnings growth (PEG) multiple of 0.4, I think that the gold play is actually quite cheap relative to its earnings prospects.

One final thing: predictions of extra dividend growth over the medium term means that at current prices, Centamin carries a monster 5.9% payout yield for 2020, too.

Take a sip

Share pickers seeking a brilliant blend of big dividends and low prices should pay Marston’s (LSE: MARS) close attention too, I reckon.

Only fractional earnings growth is anticipated for the current fiscal year (to September 2019) but this still leaves the pub operator trading on a forward P/E ratio of 9.1 times, below the broadly accepted bargain benchmark of 10 times and below.

Meanwhile, expectations of challenging trading conditions mean that Marston’s is expected to keep dividends locked at 7.5p per share, though this still results in a colossal 6.2% yield.

Marston’s has been hit by rising wage costs of late, but fortunately sinking consumer spending power isn’t whacking the leisure sector like it has retailers. Indeed, latest figures from Deloitte showed that changing consumer habits meant that spending on eating and drinking out kept growing in the third quarter.

Sales ticking higher

And this was underlined in the latest trading report from Marston’s in October, which showed like-for-like sales across its pubs rose 0.8% in fiscal 2019. In fact those financials showed that the tills have actually got a lot busier, despite rising Brexit fears in the run-up to the then-withdrawal date of 31 October, with underlying sales rising 1.9% in the final 10 weeks of the last financial period.

Rising operating costs, allied with the possibility of extended geopolitical and economic strain and protracted pressure on Britons’ spending power, means that conditions could remain tough in 2020 and possibly beyond. I would argue though that these fears are baked into the Marston’s share price at the current time. And so I reckon it remains a top income share to buy right now.

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Royston Wild has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.