3 big dividend stocks at bargain prices

In between reporting seasons there’s not a lot of exciting news coming out to keep the S&P ASX All Ordinaries Index (ASX: ^AORD) driving upwards. Stocks can meander and investors lose their focus.

Since the stock market is merely a daily auction of shares, a buyer gets better prices at dull, boring auctions, whereas hot auctions usually go up and up.

Benjamin Graham, considered one of the fathers of value investing, used the manic-depressive character called Mr. Market to illustrate this point.

Every day your business partner, Mr. Market, comes by offering to sell you his holdings. Each day’s price is different, though, depending on whether he is ecstatically high or depressed. You simply take advantage of Mr. Market’s lower prices when he’s down and bored.

Even good dividend stocks slip, so when they do, you can get a better yield and eventually enjoy the ride back up when more exciting earnings news comes. Here are a few high dividend stocks that could be at bargain prices.

Premier Investments Limited (ASX: PMV)

This clothing retailer has a number of well-known brands like Just Jeans, Jay Jays, Portmans, as well as the very successful Smiggle stationery store that is expanding widely into the UK now. The stock is recovering from an $8 low and its dividend is 4.6% fully franked.

Leighton Holdings Limited (ASX: LEI)

The big engineering and construction company has improved in share price since a new CEO came in and started plans for a business restructure. It’s still early days, however it may be an opportunity to start a position as more infrastructure and LNG related work offsets the mining pullback. It has a 5.4% yield partially franked.

Iress Ltd (ASX: IRE)

The provider of wealth management, financial planning and trading platforms such as XPLAN does steady business with rising financial markets and more managed investments like Super. It has a 4.6% yield partially franked. Earnings are forecast to rise by some analysts, but the stock has been flat recently.

A top choice for income and growth

I think Premier Investments may be the better choice for share price growth sooner than the other two because of its good brands and overseas expansion activities. However, one stock that has both good growth and dividend income right now is the Motley Fool's #1 stock for 2014

This little known ASX company has already delivered eight consecutive years of profit and dividend growth... but with even more growth ahead, the shares are still a firm "BUY" today! Discover The Motley Fool's #1 dividend pick in our newly updated report. Simply click here for your FREE copy right now.

Motley Fool contributor Darryl Daté-Shappard does not own shares in any company mentioned. 

Two New Stock Picks Every Month!

Not to alarm you, but you’re about to miss a very important event! Chief Investment Advisor Scott Phillips and his team at Motley Fool Share Advisor are about to reveal their latest official stock recommendation. The premium “buy alert” will be unveiled to members and you can be among the first to act on the tip.

Don’t let this opportunity pass you by – this is your chance to get in early!

Simply enter your email now to find out how you can get instant access.

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our Financial Services Guide (FSG) for more information.