Looking for stocks whose earnings returns are more than double the monthly spot rate of 20-year high-quality market corporate bonds could provide more opportunities to discover high-return investments. The investment-grade bonds represent corporate loans issued by triple-A, double-A and single-A rated companies.
Since these bonds are offering a monthly spot rate of 3.07% as of the time of writing, the following four stocks could be of interest to investors as their earnings returns are more than 6.14% at price-earnings ratios of less than 16.29.
Bank of America Corp
Shares of Bank of America Corp. (BAC, Financial) closed at $44.19 per unit on Tuesday for a market capitalization of about $361.65 billion.
The American bank major offers an earnings return of 7.54% and has a price-earnings ratio of 13.27.
The share price has risen 47.05% over the past year, determining a 52-week range of $29.33 to $48.69.
GuruFocus assigned a rating of 3 out of 10 for the company's financial strength and a rating of 5 out of 10 for its profitability.
Wall Street issued a median recommendation rating of overweight with an average target price of $49.96 per share for the stock.
BP PLC
Shares of BP PLC (BP, Financial) closed at $26.43 per unit on Tuesday for a market capitalization of $86.40 billion.
The London-based oil and gas giant offers an earnings return of about 7% and a price-earnings ratio of 14.30.
The stock has risen 24.61% over the past year for a 52-week range of $20.42 to $30.28.
GuruFocus assigned a rating of 4 out of 10 for the company's financial strength and a rating of 5 out of 10 for its profitability.
Wall Street issued a median recommendation rating of overweight with an average target price of $34.41 per share for the stock.
America Movil SAB de CV
Shares of America Movil SAB de CV (AMX, Financial) closed at $20.52 per unit on Tuesday for a market capitalization of $66.47 billion.
The Mexican provider of telecommunication services in the Americas and Europe offers an earnings return of 7.45% and has a price-earnings ratio of 13.43.
The stock has risen 45.82% over the past year, determining a 52-week range of $11.45 to $21.24.
GuruFocus assigned a rating of 4 out of 10 for the company's financial strength and a rating of 7 out of 10 for its profitability.
Wall Street issued a median recommendation rating of overweight for the stock with an average target price of approximately $20.20 per share.
Freeport-McMoRan Inc.
Shares of Freeport-McMoRan Inc. (FCX, Financial) closed at $39.18 per unit on Tuesday for a market capitalization of $57.53 billion.
The Phoenix-based miner of copper, gold, molybdenum, silver and other metals offers an earnings return of 6.71% and has a price-earnings ratio of 14.90.
The stock has risen 57.60% over the past year, determining a 52-week range of $24.01 to $46.10.
GuruFocus assigned a rating of 5 out of 10 for the company's financial strength and a rating of 6 out of 10 for its profitability.
Wall Street issued a median recommendation rating of overweight with an average target price of $43.37 per share.
