Just as we examine companies each week that may be rising past their fair value, we can also find companies potentially trading at a bargain price. While many investors would rather have nothing to do with companies tipping the scales at 52-week lows, I think it makes a lot of sense to determine whether the market has overreacted to the downside, just as we often do to the upside.
Here's a look at three fallen angels trading near their 52-week lows that could be worth buying.
Ring the bell
Now here's a stock I'd potentially want in my corner: World Wrestling Entertainment
In its most recent quarter, WWE pointed to live events as the main driving force behind its profits, with home video sales trends and talent development weighing on results. Neither of these negatives is surprising, with more content being offered online and talent being one of the primary costs of an entertainment company. It's WWE's ability to innovate that has me intrigued. With a WWE Network potentially in the offing, I'd entertain pinning my hopes on WWE -- especially when what I'd consider its closest peer, Time Warner
Paw-lenty of opportunity
A few months back, I insinuated that pet-related companies could be a go-to sector for the next decade, and I'm sticking to that assumption. Unfortunately for PetMed Express
Although PetMed is significantly smaller than PetSmart
A marginally safe bet
More than a year ago, Hudson City Bancorp
Despite reporting a 33% drop in income in its latest quarterly results, Hudson City had plenty of positives built into its report. The bank's loan loss provision dropped to $30 million from $50 million and net margin interest ticked slightly higher to 2.14% from 2.13% a year earlier. While I'd hardly call Hudson City's business booming, it is stabilizing, and the prospects for the company turning a profit in 2012 look very good. Not to mention that the company is currently yielding a handsome 5.5% even after a recent dividend haircut. Bank of America
Take note that not only are the potential pickups this week inexpensive, but they boast incredibly good yields relative to the market average. Adding companies like this to your portfolio puts income in your pocket while giving your money a chance to grow.
Do you think these fallen angels deserve a second chance? Sound off in the comments section below and consider adding World Wrestling Entertainment, PetMed Express, and Hudson City Bancorp to your free and personalized watchlist to keep track of the latest news with each company.
Fool contributor Sean Williams owns shares of Bank of America, but has no material interest in any other companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong and on Twitter, where he goes by @TMFUltraLong. The Motley Fool owns shares of Bank of America. Motley Fool newsletter services have recommended buying shares of PetSmart. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy that's always on the lookout for a good deal.