Data Insights

3 new ASX stocks with a P/E of under 10 (and the stock with a P/E of under 1)

Mon 26 Jun 23, 4:00pm (AEST)
Markets trading screen with stocks
Source: Shutterstock

Key Points

  • 45 stocks are on the Market Index Low P/E scan.
  • 3 new names entered the list this month.
  • 1 has a P/E of under 1, but it's raised our eyebrows.

This equity market is full of contrasts right now. On the one hand, the NASDAQ 100 has a P/E ratio of nearly 31. Inflows have surged and the Barclays AI stocks basket is up 48% year-to-date alone. Then, there’s the ASX 200 which is up only 0.5% year-to-date and has a P/E ratio of 15. Naturally, there are many nuances within these statistics but it proves just how varied the opportunities in equity markets are of late.

Underneath the hood, it appears there’s also been some movement at the very cheap end of the market. The Market Index Low P/E scan reveals there are 45 companies with a trailing P/E ratio of under 10. That’s the same as last month.

But do a little digging and you will find that the names and positions in that list have changed materially since our last review.

In this piece, I’ll show you the current list as well as provide analysis of the three new additions to the list. Plus, read on to find out which company has a trailing P/E of under one. That same stock is also up 60% in the last year.

The low P/E list

Ticker

Company

Price

PE

Mkt Cap

1 year

ANZ

ANZ Group

$22.84

9.94

$68.6 B

5.08%

WDS

Woodside Energy

$33.94

7.96

$64.43 B

10.86%

S32

South32

$3.71

7.44

$16.85 B

-7.14%

PLS

Pilbara Minerals

$4.85

8.71

$14.54 B

117.49%

BSL

Bluescope Steel

$20.33

5.53

$9.29 B

30.07%

SPK

Spark New Zealand

$4.69

8.23

$8.65 B

6.24%

ALD

Ampol

$29.78

9.81

$7.1 B

-10.17%

YAL

Yancoal Australia

$4.39

1.62

$5.8 B

-15.25%

WHC

Whitehaven Coal

$6.52

1.83

$5.69 B

44.25%

IPL

Incitec Pivot

$2.70

6.92

$5.24 B

-17.68%

ILU

Iluka Resources

$11.22

9.23

$4.78 B

28.69%

JBH

JB Hi-Fi

$41.75

7.9

$4.56 B

5.88%

VEA

Viva Energy

$2.92

8.82

$4.51 B

6.18%

NHC

New Hope Corp

$4.83

3.42

$4.26 B

49.07%

BKW

Brickworks

$27.52

6.44

$4.19 B

48.28%

HVN

Harvey Norman

$3.23

5.39

$4.02 B

-14.68%

BPT

Beach Energy

$1.34

6.15

$3.05 B

-15.77%

SGM

Sims

$15.00

6.74

$2.9 B

8.46%

GNE

Genesis Energy

$2.53

9.37

$2.7 B

5.86%

ZIM

Zimplats Holdings

$23.76

7.47

$2.56 B

-1.00%

CRN

Coronado Global

$1.48

3.22

$2.48 B

-11.38%

SUL

Super Retail Group

$10.73

8.9

$2.42 B

24.62%

SMR

Stanmore Resources

$2.59

3.09

$2.33 B

33.85%

PRU

Perseus Mining

$1.69

7.47

$2.31 B

-1.89%

BFL

BSP Financial Group

$4.93

2.13

$2.3 B

3.57%

SNZ

Summerset Group

$8.64

7.42

$2.01 B

-1.26%

APM

APM Human Services

$2.11

6.94

$1.94 B

-20.08%

VUK

Virgin Money Uk

$2.72

8.07

$1.91 B

19.30%

GNC

Graincorp

$7.60

5.11

$1.7 B

-16.36%

MFG

Magellan Financial Group

$8.67

7.46

$1.57 B

-37.35%

KAR

Karoon Energy

$1.97

9.87

$1.11 B

18.73%

HGH

Heartland Group

$1.52

9.84

$1.08 B

-7.62%

HLI

Helia Group

$3.29

6.72

$1.06 B

43.45%

ELD

Elders

$6.13

7.95

$958.42 M

-50.72%

MSB

Mesoblast

$1.13

0.48

$918.02 M

62.23%

WAF

West African Res

$0.82

5.14

$836.77 M

-34.07%

NCK

Nick Scali

$8.34

6.62

$675.54 M

0.00%

ACL

Australian Clinical Labs

$3.29

8.99

$664.03 M

-26.23%

FPR

Fleetpartners Group

$2.40

8.11

$648.24 M

6.67%

PPM

Pepper Money

$1.36

4.33

$595.88 M

5.45%

SWM

Seven West Media

$0.38

3

$590.13 M

-1.32%

GMD

Genesis Minerals

$1.22

1.01

$579.06 M

-9.82%

WTN

Winton Land

$1.91

8.45

$566.53 M

-44.64%

PPC

Peet

$1.20

8.6

$563.25 M

24.48%

GRR

Grange Resources

$0.48

3.21

$549.74 M

-60.42%

The new names

There are three new names on this list. All of them have a P/E of between 9 and 10. 

ANZ (ASX: ANZ) may have a dividend yield of 6.4% and a P/E ratio of 9.91 but it’s not exactly a capital grower. In the past year, the stock has only made a 4.7% return on investors’ capital. And there may be more bad news coming, with Morgan Stanley analysts expecting a 15bps fall in net interest margins over the next 18 months for the Big Four banks. The one consolation is that ANZ is their preferred bank. 

ANZ vs ASX Financials
ANZ vs. XFJ (Source: Market Index)

Ampol (ASX: ALD) also finds its way onto our refreshed low P/E list but it’s not likely for the reason it would like. The share price has fallen 10% in the last 12 months and continues to lag the energy index significantly. For those who want to play the renewable energy thematic, Ampol has been touted by Credit Suisse analysts as a way to play investing’s most important megatrends. The stock is also on the brokers’ side with Macquarie, UBS, and Ord Minnett all having outperform, buy, and accumulate ratings respectively. 

ALD vs ASX Energy Index
Ampol vs. XEJ (Source: Market Index)

Karoon Energy (ASX: KAR), in contrast, is actually performing in line with the ASX Energy Index. It’s up 18% year-on-year and has a P/E ratio of 9.82. It’s also a favourite among the brokers with 11 buy ratings and just 2 holds. Morgans has a price target of $3.55/share, more than 80% above the current share price! It’s also a favourite stock of Rick Squire of Acorn Capital who first invested in the company in September 2020. He calls it a perfect case of how the Lassonde Curve can help you pick winners in the resources market. 

KAR vs ASX Energy Index
Karoon vs. XEJ (Source: Market Index)

And the 1 under 1

Mesoblast (ASX: MSB) has never turned a profit but it’s popped up as a company with a PE of just 0.5. My hunch is that this is an error associated with our data vendors.

Nevertheless, the stock is up more than 60% in the last year and far outperforming its benchmark sector. 

MSB vs ASX Healthcare Index
Mesoblast vs. XHJ (Source: Market Index)

The company is a homegrown company dealing in regenerative medicine which hopes to produce and sell treatments for cardiovascular disease and back pain. It’s loved by the brokers with 9 out of 11 on the Market Index scan rating the stock a BUY. Bell Potter has a $2 price target on the company, some 75% above its current share price. It’s also been flagged by independent researcher Claire Aitchison who says the company’s freshly restocked balance sheet could be good news for its future plans.

Written By

Hans Lee

Senior Editor

Hans is one of the Senior Editors at Livewire Markets and Market Index. He created Signal or Noise and leads the team's coverage of the global economy and fixed income markets.

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