It isn't easy to find bargains on the stock market these days. According to a recent analysis by FactSet, the average forward price-to-earnings ratio (P/E) for the S&P 500 index currently stands at 21.5, which is notably above the 17.6 ratio it stood at 10 years ago.
So it's gotten a bit tougher to find good choices in the big haystack of equities out there, but there are still some needles in this haystack worth considering. Even better, a few of them pay generous dividends.
Here's a brief look at two of these discounted stocks, Enterprise Products Partners (EPD 0.89%) and Bristol Myers Squibb (BMY 1.48%), and why they are worth considering at the moment.
Image source: Getty Images.
1. Enterprise Products Partners
Enterprise Products Partners is a large midstream energy company that operates an enviable portfolio of assets, from pipelines to storage facilities to deepwater docks.
All things being equal, the midstream segment of the energy sector is steadier than the upstream (exploration and production) and downstream (retail) segments. That's because it tends to operate on long-term contracts and facilitates the movement of energy assets, rather than extracting them from the earth or selling their end products.
With that advantage, Enterprise has been consistently profitable, with net margins generally coming in a bit over 10%. Strong operating cash flow leaves plenty of room not only for dividend payments, but also for significant capital expenditures to help widen the company's revenue base. This year, for instance, it'll spend anywhere from $2.5 billion to $2.9 billion for this purpose.
Despite a recent rally in Enterprise's share price, the stock is still surprisingly inexpensive and trades at a forward P/E just above 13. That works out to a dividend yield of just under 5.9%, which is more than five times the average of all S&P 500 index components.
NYSE: EPD
Key Data Points
2. Bristol Myers Squibb
A business transformation is never easy, especially in the capital-intensive pharmaceutical industry. For years, Bristol Myers lived well on a pair of blockbuster drugs -- multiple myeloma treatment Revlimid and blood thinner Eliquis. Yet Eliquis is fast approaching its patent cliff, and last month, Revlimid tumbled off it entirely.
These days, the two medications are bundled into the company's so-called "legacy" portfolio -- its collection of drugs that are no longer the revenue-increasing powerhouses they once were. At the same time, it's pumping up its fresher "growth" portfolio -- anchored by cancer treatment Opdivo -- of drugs shielded by patents or other legal protections. In its fourth quarter of 2025, the latter's revenue rose 16% year over year.
NYSE: BMY
Key Data Points
However, that was mitigated by the legacy portfolio's 15% decline, and the still-considerable size of that collection is weighing on Bristol Myers stock. Combined, total revenue only inched up by 1% year over year in said quarter, and that's not the kind of robust improvement investors expect of Big Pharma these days.
Bristol Myers' shares remain a bargain play on that yet-to-be-completed transformation; its forward P/E sits below 10. That's unforgivably cheap for a big pharma player with a growing collection of blockbuster drugs, not to mention a frequent dividend raiser with a payout that currently yields a generous 4.2%.
