The best bargain retirement stocks are usually those that provide dividends sustained by earnings. Unlike volatile growth stocks, these dividend-paying stocks offer reassurance, signifying a firm’s commitment to returning capital to shareholders. Hence, for investors eyeing cheap retirement stocks that align with these principles, the following list will likely pique their interest. Down 10% or more on average over the past year, these stocks yield between 3% to 5%, boasting an amazing 3-year dividend growth of over 30%. While promising, it’s worth noting that these bargain retirement stocks carry a relatively higher risk, blending caution with opportunity in your retirement portfolio.
Bargain Retirement Stocks: Levi Strauss (LEVI)
The Levi Strauss (NYSE:LEVI) stock may have stumbled in the recent quarter, particularly with its wholesale unit’s lackluster performance, but don’t pack up those jeans just yet. Its slashed full-year outlook might seem like a tear in the fabric, but the negativity may have been priced in already.
Looking beyond the fray of the U.S. wholesale, results were far from tattered. The expectation of margin tailwinds into the fourth quarter, along with an anticipated increase in overall adjusted EBIT margins by nearly 100 basis points in the second half, weave a promising picture. Moreover, with thriving Direct-to-Consumer and international units, patient investors find LEVI stock an exciting bet. Additionally, it boasts a 3-year dividend growth rate of more than 15.7% while yielding a handsome 3.2%.
Bargain Retirement Stocks: Eramet (ERMAY)
Mining titan Eramet (OTCMKTS:ERMAY) is digging deep to position itself as a one-stop shop for battery metals, becoming one of the largest manganese and nickel mines and now eyeing lithium. Nevertheless, the recent quarter threw some grit in its gears, as pricing for manganese alloys and class II nickel took a nosedive. However, this setback has nothing on the firm aiming to capitalize on the robust electric vehicle (EV) market.
Additionally, by 2030, about 50% of cars sold are expected to be fully or partially electric. This green transition is creating a rich vein of opportunity for battery metals, with demand for nickel anticipated to double and lithium requirements projected to grow six-fold by 2030. Eramet boasts rock-solid profitability with double-digit gross and EBITDA margins expansion over the past five years. Moreover, with the stock yielding over 4.5%, its strategic alignment with long-term market trends could be a gem for forward-looking investors.
Bargain Retirement Stocks: First Savings Financial (FSFG)
First Savings Financial (NASDAQ:FSFG), with its finger on the pulse of southern Indiana’s bustling economy, is poised to reap the rewards from the region’s expansion. Whether manufacturing, healthcare, or other sectors in this vibrant realm are flourishing, FSFG’s solid presence in the market complements these growing industries. Their strong earnings over recent years, attributable to factors such as impeccable customer service and an effectively managed lending portfolio, underscore the company’s winning strategy.
In a savvy move to broaden horizons, FSFG is not only spreading its wings by growing its branch network but enticing fresh customers with its innovative products and services. Moreover, the cherry on top is its commitment to shareholders which shines through dividends and share repurchases, backed by nine years of consecutive dividend growth and a 3% yield.
Telecom titan Ericsson’s (NASDAQ:ERIC) investors find themselves in a spot of bother. While 5G technology hasn’t quite sprinted out of the gate as analysts predicted, there’s no dampening the burgeoning demand for more and more connectivity. Smartphones are greedier than ever, and new technologies such as autonomous cars will only tighten the torque on the network. Despite a slowdown in new customer signups, Ericsson’s place in the future seems more than secure.
Furthermore, Ericsson’s stock is trading at just 0.6 times forward sales, a staggering 78% lower than the sector median, while its dividend yield has blossomed by more than 4.9% with three years of growth. Especially as customers turn a wary eye toward Chinese competitors, Ericsson’s role in deploying 5G networks might be one to watch without the usual tech-stock sticker shock.
Tronox (NYSE:TROX) has established a powerful presence in the realm of titanium dioxide production, casting a promising light on its financial horizon. After encountering turbulence towards the close of last year, Tronox’s EBITDA margin is glittering at an encouraging 20%, surpassing the sector average by roughly 13.5%. Add to this a robust cash flow from operations, 21% higher than the sector at $434 million.
However, that’s not all, as Tronox also claims an impressive dividend profile, yielding a remarkable 3.7% with a track record of three consecutive years of growth. Trading at just 4.9 times cash flows on a trailing twelve-month basis, Tronox’s stock appears poised to paint a profitable picture for discerning investors willing to block out the bearish noise.
InvenTrust Properties (IVT)
InvenTrust Properties Corp’s (NYSE:IVT) strategic portfolio of grocery-anchored shopping centers is predominantly located in the Sunbelt. With 41% of the REIT’s rent flowing from the rapidly expanding state of Texas, the geographical focus is clearly paying dividends. The firm’s organic growth last year not only topped the charts among its peers but remains poised to repeat this year’s feat.
The dividend, yielding a moderate 3.5%, is more than a mere number with a payout ratio of more than 50% and a robust growth history; it is a testament to IVT’s financial prudence. Moreover, IVT has its portfolio concentrated in burgeoning markets, offering abundant liquidity, and minimal debt exposure, with 98% of total debt at fixed rates and only 2% maturing before 2025. Additionally, its debt to equity is at 53%, 46% lower than the sector median.
Sturm Ruger (RGR)
Sturm Ruger (NYSE:RGR) is a top firearms manufacturer in the U.S., specializing in developing rifles, pistols, and revolvers. Despite a 10% drop in first-quarter sales, it took decisive measures to realign production with demand, effectively reducing inventory efficiently. This strategic approach laid the foundation for future growth, evidenced by its balance sheet with zero debt and a healthy asset base.
The company then showcased its resilience in the second quarter, delivering a GAAP EPS of 91 cents, an improvement of 10 cents sequentially. Furthermore, revenue of $142.8 million marked a 1.5% year-over-year increase, beating expectations by $6.66 million. Such numbers speak volumes about Sturm, Ruger & Co.’s ability to navigate through choppy waters and maintain an encouraging long-term trajectory. Moreover, it yields a heartening 3.1% payout ratio of almost 40%.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.