LONDON -- Yesterday, prompted by eurozone worries, the FTSE 100 fell more than 2% -- with those shares deemed heavily exposed to the euro's travails falling faster and further. This morning, as they reviewed the carnage, investors sensed bargains.
At the top of the list: Aviva
And it's not difficult to see the attraction: At today's price, Aviva is on a forecast P/E of just five and offers a mouthwatering forecast yield of 9.2%. That said, the incoming chairman has expressed only the "hope" that the dividend can be maintained -- and, as I mentioned earlier this month, both a statistical test and the company's dividend cover give cause for concern that the dividend will indeed survive unscathed.
In dividend and yield terms, the story is similar. Announcing cost-cutting measures, Man said it would hold its interim dividend, with the estimated full‑year dividend of 14.2 pence putting the company on a remarkable forecast yield of 18.7%.
Finally, nothing quite so obvious seems to have prompted investors' interest in Premier Foods
Again, the share might be at bargain levels, having fallen by 20% in little more than two weeks on no real adverse news at all. That said, Premier's ability to surprise on the downside is well-honed -- it's down 99% since the onset of the credit crunch in 2007 -- and a forecast P/E of 2.1 and lack of dividend surely make it one for the brave.
Will today's Premier punters be disappointed? Time will tell.
Finally, what are super investors Neil Woodford and Warren Buffett buying today? We can't tell you that, but we can tell you the names of the shares they've been buying in the recent past -- and why they've been buying them.
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Investing ideas from Malcolm Wheatley: