5 High Earnings Yield Value Picks to Buy for 2025

Economic Outlook - The Federal Reserve is anticipated to implement its third consecutive rate cut in 2024, reducing the benchmark policy rate by 0.25% to a range of 4.25%-4.50%, marking a total drop of one percentage point since September [1] - The future of additional rate cuts is uncertain due to inflation exceeding the Fed's 2% target and stronger-than-expected economic growth complicating the central bank's decisions [1][2] Investment Strategy - In the current uncertain economic environment, value investing is highlighted as a strategic advantage, focusing on stocks trading below their intrinsic value for potential long-term gains [3] - The earnings yield metric is suggested as a useful tool for identifying attractively valued stocks, calculated as annual earnings per share divided by market price, with higher earnings yield indicating undervaluation [4][5] Stock Selection Criteria - A primary screening criterion for stock selection is an earnings yield greater than 10%, supplemented by estimated EPS growth for the next 12 months being greater than or equal to the S&P 500 [8] - Additional criteria include an average daily trading volume of at least 100,000 and a current price of $5 or more [9][10] Value Stock Recommendations - Pitney Bowes (PBI) is projected to have a 176% year-over-year earnings growth for 2025, with a Zacks Rank 1 and a Value Score of A [12] - Gulfport Energy Corporation (GPOR) is expected to see a 46% growth in 2025 earnings, also holding a Zacks Rank 1 and a Value Score of B [13] - Kingstone Companies, Inc. (KINS) anticipates an 11% growth in 2025 earnings, with a Zacks Rank 1 and a Value Score of B [14] - NCR Atleos Corporation (NATL) is projected to achieve a 15% growth in 2025 earnings, maintaining a Zacks Rank 1 and a Value Score of A [15] - Gilead Sciences (GILD) expects a 73% growth in 2025 earnings, currently holding a Zacks Rank 2 and a Value Score of B [16]