4 undervalued small-cap stocks with superior dividend yields

Expand your universe of investment opportunities by looking outside of the large-cap sector.

| More on:
a woman

You鈥檙e reading a free article with opinions that may differ from The Motley Fool鈥檚 Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Focusing on smaller stocks which aren鈥檛 followed by practically every analyst and fund manager can give investors an advantage in that they can discover under-researched companies which have the potential to also be undervalued.

Here are four companies, each with market capitalisations below $600 million which appear to not only be undervalued but which also (based on consensus data provided by Morningstar) are trading on attractive forward dividend yields.

Countplus Ltd (ASX: CUP) is a network of accounting practices operating from approximately 37 offices which are spread throughout 19 cities and towns across Australia. The company has the potential to lead further consolidation of this fragmented industry. With a forecast financial year (FY) 2015 price-to-earnings (PE) ratio of 12.7 and dividend yield of 6.7% fully franked, this stock could be one to count on going up.

360 Capital Industrial Fund (ASX: TIX) is a manager of property assets. With a FY 2015 forecast for earnings per share (EPS) and unfranked dividends per share of 20.6 and 19 cents, the stock is trading on a PE and yield of 10.5 and 8.7% respectively.

Wotif.com Holdings Limited (ASX: WTF) has seen its share price dramatically sold down in the past 12-months as investors have become increasingly concerned about the entry of competitors into the domestic online travel and accommodation marketplace. The sell-off has however made the PE and yield that Wotif.com trades on significantly more appealing. Based on consensus numbers, the stock is trading on a FY 2015 PE of 13.2 and a fully franked yield of 7.6%.

Pacific Brands Limited (ASX: PBG) is an Australian-based wholesaler and retailer of apparel, footwear and home wares. The company is best known for its ownership of the Bonds brand. With a forecast for EPS of 6.6 cents in FY 2015 and dividends per share of 4.2 cents, the stock is trading on an enticing PE of 7.9 and fully franked dividend yield of 8%.

Motley Fool contributor Tim McArthur owns shares in Pacific Brands Ltd.

More on 鈴革笍 Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
鈴革笍 Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
鈴革笍 Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more

asx share price competitions represented by businessmen arm wrestling
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more

asx investor daydreaming about US shares
鈴革笍 How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more

person reading news on mobile phone
鈴革笍 Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more