Of all the insight I've heard over these few crazy months, the most telling came from an investor who appeared on CNBC last fall and, being entirely serious, advised, "There're only two positions to be in right now: cash, and fetal."

I get it. Even with the recent rally, it's bad out there. Many companies that overleveraged their balance sheets are permanently impaired and likely will never fully rebound -- companies like Citigroup (NYSE:C) and General Motors (NYSE:GM) come to mind. We had an unprecedented boom; now we're in the middle of an unprecedented bust. That's how markets work.

Nevertheless, history tells us time and time again that market panics and forced sell-offs indiscriminately throw the good out with the bad. Amid the frenzy over financial markets and the "sell-now-ask-questions-later" mood of global investors, opportunities the likes of which we haven't seen in decades are being created for bargain-hunting investors.

Using the wisdom of our 130,000-member-strong Motley Fool CAPS community, I've hunted down a few dirt cheap, high-quality companies. Have a look:

Company

Recent Share Price

Forward P/E Ratio

5-Year

Expected Growth Rate

TTM Return on Equity

Dividend Yield

CAPS Rating  
(5 max)

Procter & Gamble (NYSE:PG)

$47.25

 

11.6

9.5%

18.5%

3.3%

*****

Philip Morris International (NYSE:PM)

$36.44

10.6

9.3%

59.6%

5.7%

*****

Paychex (NASDAQ:PAYX)

$26.61

18.2

12.8%

44.7%

4.6%

****

Data from Yahoo! Finance and Motley Fool CAPS. TTM = trailing 12 months.

All three are well-established, large-cap stocks. Let's break down the bullish argument for each one.

Cheap and reliable
After being spun off from Altria Group (NYSE:MO), Philip Morris International now gets to roam the world without the legal hoopla of its domestic parent.

That's a big liberation, because huge sections of the world include heavier smokers than Americans and are devoid of some of our onerous regulations. CAPS member AccountantMike recently elaborated on this point:

I've done lots of traveling in the developing world and people there smoke like chimneys. There are a lot fewer regulations about advertising cigarettes, selling to kids etc. internationally. Foreign governments have bigger problems on their minds than regulation of the tobacco industry, and no government wants to kill the golden goose of tax revenues. ...

Since this company draws it's revenues in foreign currencies but books profits in USD, it's profits will be inflated by the long term decline of the greenback. Don't forget the rock solid balance sheet, juicy dividend, and the fact that the product is addictive.

Moral reservations aside, tobacco companies are historically some of the top-performing investments out there. Juiced by international growth, this company takes that to a whole new level. Add in a 5.7% dividend, and you're smokin' something completely different if this stock doesn't do it for you.  

Recession or no recession, people never stop brushing their teeth (I hope)
Another global giant that has been hacked down in price is Procter & Gamble. Sure, consumer spending is in the pits and unemployment is blowing up, but P&G is the master of consumer products that are both (a) nondiscretionary, like toothpaste, and (b) incredibly brand-sensitive. Add the two together, and you get an almost recession-proof company trading at its lowest level in years. CAPS member raptor69357 makes the case:

What can I say? I shower, I shave, I use their products. In today's current economic climate many investors are going to look to solid blue chip growth purchases. Look to see many who have been burned in the recent upheaval to do that same even after the market has corrected.

At 11 times forward earnings, you're getting a world-class company at about half the multiple it commanded in recent years. Don't expect that to last long.

Waiting for a rebound
Paychex is a stock with a little more potential for those who see economic rebound on the horizon. Once the crushing number of job losses tapers off, this company can get back to doing what it does best: Growing business through payroll processing for its niche market -- small businesses. However unglamorous, this is a lucrative client base to focus on. While Paychex is much smaller than rival ADP (NYSE:ADP), it has managed to grow business by more than 14% a year for the past five years.

Though Paychex is still trading at a relatively lofty valuation, premium companies deserve premium multiples. Before balking at the price, don't forget what this company really is: An incredibly efficient business with enormous returns on capital, an impenetrable balance sheet, and a 4.6% dividend yield. Those traits are worth their weight in gold these days. 

Your turn to chime in
What do you think about any of the companies? More than 130,000 investors use CAPS to share ideas and swap opinions. Check it out and speak your mind. It's 100% free to participate.

For further Foolishness:

Fool contributor Morgan Housel owns shares of Altria, Philip Morris International, and Procter & Gamble. Philip Morris International is a Global Gains recommendation. Paychex and Procter & Gamble are Income Investor selections. Paychex is also an Inside Value recommendation. The Fool owns shares of Procter & Gamble. The Fool has a disclosure policy.