36 ASX stocks with P/Es under 10
Do you love a bargain? Have we got some ideas for you.
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Mentioned
KEY POINTS
- Energy stocks are back in vogue, while lithium darlings have taken a breather
- Many REITs have P/Es of under 10, but the ASX Real Estate Index has essentially traded flat over the last 12 months
- A number of stocks are trading at sub-10 P/E ratios and have significant upside potential, according to analysts
At the headline level, the ASX 200 is up 3.5% in the last month. But look beneath the surface and some fascinating stories emerge. Energy stocks are back in vogue with Woodside Energy (ASX: WDS) trading near all-time highs and both major coal stocks, Whitehaven (ASX: WHC) and New Hope (ASX: NHC) are bouncing from recent lows.
In contrast, there’s been some hot air taken out of lithium darlings Pilbara Minerals (ASX: PLS) and Iluka Resources (ASX: ILU). Not that it’s affecting their one-year performance figures though! Pilbara is up over 80% in the last year and over 400% in the last five years.
Sectors that were once unloved are continuing to tread water. Many REITs have P/Es of under 10 but the ASX Real Estate Index has essentially traded flat over the last 12 months. In contrast, companies like Harvey Norman (ASX: HVN) and JB Hi-Fi (ASX: JBH) have experienced a rebound in the last month, despite investors continuing to assess the lagged effects of rate hikes.
All this sets us up for an incredibly interesting August, a time when companies full-year reports come to light. In this wire, I’ll update you on the stocks trading at sub-10 P/E ratios and provide analysis on some of the more interesting stocks.
ASX 200 stocks with PEs of less than 10
Ticker | Name | Close Price | PE | Target price | Return |
|---|---|---|---|---|---|
WHC | Whitehaven Coal | $7.23 | 2 | $8.52 | 17.80% |
CRN | Coronado Global | $1.69 | 3.1 | $2.05 | 21.30% |
NHC | New Hope | $5.39 | 3.7 | $6.29 | 16.70% |
NSR | National Storage | $2.26 | 5 | $2.34 | 3.50% |
CQR | Charter Hall Retail | $3.75 | 5.1 | $4.15 | 10.70% |
CIP | Centuria Industrial | $3.18 | 5.2 | $3.40 | 6.90% |
S32 | South32 | $3.72 | 5.2 | $4.65 | 25.00% |
GNC | Graincorp | $8.08 | 5.5 | $9.18 | 13.60% |
BSL | Bluescope Steel | $20.29 | 5.5 | $22.68 | 11.80% |
WAF | West African Resources | $0.89 | 5.6 | $1.60 | 79.80% |
CQE | Charter Hall Social Infrastructure | $3.04 | 5.7 | $3.52 | 15.80% |
BKW | Brickworks | $25.38 | 5.9 | $25.98 | 2.40% |
HVN | Harvey Norman | $3.65 | 6.1 | $3.79 | 3.80% |
CLW | Charter Hall Long Wale Reit | $4.05 | 6.2 | $4.37 | 7.90% |
WDS | Woodside Energy | $37.25 | 6.2 | $36.74 | -1.40% |
ARF | Arena Reit | $3.76 | 6.7 | $3.95 | 5.10% |
HDN | Homeco Daily Needs Reit | $1.20 | 6.7 | $1.38 | 15.00% |
SGM | Sims | $15.43 | 6.8 | $15.48 | 0.30% |
BPT | Beach Energy | $1.50 | 6.9 | $1.76 | 17.30% |
IPL | Incitec Pivot | $2.95 | 7.6 | $3.37 | 14.20% |
PRU | Perseus Mining | $1.69 | 7.6 | $2.41 | 42.60% |
KAR | Karoon Energy | $2.17 | 7.6 | $2.84 | 30.90% |
MFG | Magellan Financial | $9.08 | 7.7 | $8.50 | -6.40% |
ABP | Abacus Property Group | $2.61 | 8.1 | $2.97 | 13.80% |
FMG | Fortescue Metals | $22.19 | 8.1 | $18.37 | -17.20% |
STO | Santos | $7.90 | 8.4 | $8.69 | 10.00% |
JBH | JB HI-FI | $44.24 | 8.4 | $46.56 | 5.20% |
BHP | BHP Group | $44.34 | 8.5 | $45.55 | 2.70% |
CHC | Charter Hall Group | $11.28 | 8.7 | $13.70 | 21.50% |
PLS | Pilbara Minerals | $4.59 | 8.8 | $5.09 | 10.90% |
ILU | Iluka Resources | $10.51 | 8.8 | $11.36 | 8.10% |
SPK | Spark New Zealand | $4.69 | 8.9 | $4.81 | 2.60% |
ELD | Elders | $7.06 | 9.3 | $9.31 | 31.90% |
SOL | Washington H Soul Pattinson & Company | $32.46 | 9.3 | $30.65 | -5.60% |
NIC | Nickel Industries | $0.81 | 9.3 | $1.15 | 42.00% |
VEA | Viva Energy Group | $3.14 | 9.4 | $3.36 | 7.00% |
BWP | BWP Trust | $3.74 | 9.5 | $3.52 | -5.90% |
Close price refers to closing price on Monday, 24 June. Target price reflects the average consensus target prices within Refinitiv database. (Table: Market Index | Source: Refinitiv)
More to come
Even a quick glance at this list reveals an intense sense of bullishness among the sell-side analyst community. Of the 36 stocks on the list, only 5 have a negative differential between the consensus price target and the current share price.
In the case of one company - West African Resources (ASX: WAF) - the sell-side thinks there could be as much as 80% upside from here! That either means all the analysts are very wrong or they are all very right. I’ll leave it to the shareholders to duke this one out.
Similarly, Perseus Mining (ASX: PRU) and Nickel Industries (ASX: NIC) have upsides of more than 40% baked into their consensus price targets.
Two sectors taking most of the bounce
A quick glance of the share price performances over the last month specifically reveals some interesting thematic trends.
Agriculture stocks are starting to reap some rewards for investors - GrainCorp (ASX: GNC), Elders (ASX: ELD), and Incitec Pivot (ASX: IPL) are up 10%, 13%, and 9% respectively. Most meteorologists expect the next El Nino (dry weather wave) is coming and that generally has a negative effect on these stocks. Perhaps people are positioning ahead of the next La Nina moment? (Although I am pretty sure these cycles typically run for two to eight years).
Oil and coal stocks continue to perform strongly. Beach Energy (ASX: BPT) is up more than 13% in the last month, although it remains down by nearly 16% over the whole year. In contrast, Karoon Energy (ASX: KAR) is up 11% in the last month and 32% over the last year. Brokers also expect far more upside in Karoon.
AREITs aplenty
Over the last few months, Real Estate Investment Trusts have featured heavily on this list. Of the 36 stocks on the list, 9 are REITs or real estate-linked stocks. Having said this, the majority of those are also in the red over the last year. The repricing of interest rates to much higher levels has really hurt net asset values and discount rates and that’s likely to continue as long as the Reserve Bank continues to hike rates.
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