The 10 top value stocks to buy for 2022.
In an expensive stock market trading near record highs, it's not easy to pay up for growth stocks. And, as the past few months have shown, there's a lot of risk in chasing the high-fliers. There have been huge sell-offs in special-purpose acquisition companies, software stocks and electric vehicle firms, among others. As such, many investors are looking to more defensive value companies for 2022. There are numerous definitions of a value stock. Many investors use book value, relative valuations compared to the sector, free cash flow or valuations compared to a historical mean, among other metrics. However, for the sake of this list, the criteria of 15 times forward earnings will be the barometer. Any stock trading for less than that threshold is eligible, and anything over that number is excluded. With that definition set, here are 10 of the best value stocks to buy for 2022.
Verizon Communications Inc. (ticker: VZ)
It's not glamorous, but for investors seeking a safe and cheap high-yield stock, the telecom industry isn't a bad place to look. Specifically, Verizon offers a lot of appeal after an underwhelming 2021. The company has spent most of the past five years trading between $50 and $60 per share. The stock doesn't move quickly. And an inability to capitalize on the 5G upgrade cycle until now has squashed what little momentum Verizon may have had. At some point, however, the 5G investments should start to pay dividends. In the meantime, Verizon continues to enjoy incredible cash flows from its core business. The stock won't deliver big overnight returns, but it's got a steady 4.9% dividend yield with some upside potential given its bona fide value-stock status at 10 times earnings.