Image source: Flickr user Jim Makos. 

Investors have experienced quite the rollercoaster ride in 2016. Volatility is always present in the stock market to some degree, but the near-immediate 10% plunge in all three major U.S. indexes that began the year, and the ferocious three-week rally that's in effect eliminated the majority of those early year losses, probably have investors wondering what's next.

To calm investors' jitters, we've been looking at a myriad of ways large-cap and megacap stocks (those with valuations in excess of $100 billion) can be used to provide stability, and often income, for investors. We've examined companies with strong records of cash flow, and we've also looked at businesses sitting on veritable boatloads of cash. What we've not done yet is look at megacap stocks that look downright cheap.

The cheapest megacap stocks
What's considered cheap? Well, that's completely arbitrary since certain industries naturally trade at lower price-to-earnings multiples (the most common measure of a publicly traded company's "value") than others. But for the sake of argument, we'll only consider companies trading at forward P/Es of less than 10.

As of last Monday's close (March 21), there were 60 publicly traded stocks sporting valuations in excess of $100 billion. However, just six of these megacap companies offer investors the chance to be partial owners of businesses with single-digit forward P/Es. Here's a snapshot of all six companies.

Gilead Sciences: forward P/E of 7.5
Out of all of the market's publicly traded companies, none boasts a lower perceived valuation based on forward P/E than drug developer Gilead Sciences (GILD -0.56%).

Image source: Gilead Sciences.

The reason Gilead's valuation remains so seemingly low is that many analysts on Wall Street view its growth phase as mostly over. If you recall, Gilead is the company behind game-changing (and expensive) hepatitis C drugs Sovaldi and Harvoni. Combined, these drugs helped generate $19.1 billion of Gilead's $32.2 billion in product sales in 2015. Unfortunately, new product entrants will challenge Gilead for customers, potentially capping Harvoni's reach.

Nonetheless, Gilead is a veritable cash cow. In fiscal 2015 it generated $20.3 billion in cash flow, which affords it the ability to repurchase common stock, pay a dividend to investors, and consider acquisitions to bolster its pipeline. With a number of exciting compounds intent on tackling hepatitis B, nonalcoholic steatohepatitis, and even cancer, Gilead's pipeline could still have a few growth surprises up its sleeve.

Citigroup: forward P/E of 7.7
A theme you'll notice among the cheapest megacap stocks is they're dominated by money center banks. Citigroup (C 2.02%) just happens to be the "cheapest" of the bunch with a forward P/E of 7.7.

Image source: Citigroup.

Why is there little love for Citigroup? The three big issues Citi has are 1) it has a relatively high amount of energy loans on its balance sheet compared to its large U.S.-based peers; 2) it has a lot of exposure to Europe compared to other U.S. banks, leaving its growth rate somewhat stagnant as the EU copes with debt issues; and 3) it's being pressured by fears of a global growth slowdown.

Despite these worries, Citigroup recorded $17.2 billion in net income in 2015, its best year since 2006. The company has worked diligently to shed noncore assets, and it's been working recently to reduce its energy exposure, although it'll take time for this to happen. In the fourth quarter, Citigroup announced that its expenses fell by a whopping 19% as it's benefited from lower legal expenses, as well as a smaller and simpler business model. Considering that it's only valued at roughly 70% of tangible book value, Citigroup's valuation could still have room to grow.

Toyota Motor: forward P/E of 7.9
Toyota Motor (TM -1.08%) is a great example of value being subjective, with most of the auto industry trading for a single-digit forward P/E.

2016 Toyota Prius Four Touring. Image source: Toyota Motor.

Why no love for Toyota and autos in general? Wall Street expects U.S. auto sales to peak in the coming year or two, and China, the world's largest auto market, delivered its slowest GDP growth in 25 years in 2015. There's concern that auto demand could begin to slow globally, and therefore it wouldn't be wise to bid up the valuations of automakers too high.

Toyota's numbers through the first nine months of fiscal 2016 do indeed show some pressure with a modest decline in year-over-year vehicles sales. However, strength in North American auto sales, along with cost-reduction efforts (as well as positive foreign exchange effects) have pushed its operating income higher. If there is a silver lining here, it's that research and development spending has been the primary drag on margins recently, and R&D should ultimately translate into innovation and new product launches. Patient investors may well be rewarded.

Bank of America: forward P/E of 8.5
Cue the next bank on our list of cheap megacap stocks, Bank of America (BAC 1.59%), with a forward P/E that's still below nine.

Image source: Bank of America

The biggest issue for Bank of America has been less its exposure to energy loans -- although it has faced its share of downside pressure this year because of its possible energy exposure -- and more the long line of settlements it's had to pay to the Justice Department because of its practices during the mortgage meltdown between 2007 and 2009. According to The Huffington Post, Bank of America paid a whopping $61.2 billion in fines tied to its mortgage practices, and that was just through the midpoint of 2014.

Although fines aren't exactly welcome, consumers and investors also tend to have a short memory span. This bodes well for Bank of America, which is looking to alter its tarnished image and get back to the bread and butter of banking -- loans and deposits. More importantly, we're beginning to see true apples-to-apples operating comparisons on a year-over-year basis with its litigation now in the rearview mirror. As growth returns and expenses fall, Bank of America may be able to really ramp up dividend payments and stock buybacks.

HSBC: forward P/E of 9
Of the six megacaps with a single-digit forward P/E, European banking giant HSBC (HSBC 0.83%) could be the worst for the wear. Its forward P/E of nine is a reflection of the recent downward momentum of its share price.

Image source: Pixabay.

Last month HSBC reported its fiscal 2015 results, announcing a $13.5 billion profit for the full-year but taking an unexpected $1.3 billion loss in the fourth-quarter. Like Citi and Bank of America above, tumbling commodity prices were to blame as its energy loans came under pressure. But HSBC has also been transforming its business, and doing so on such a grand scale often comes with hiccups.

On the flipside, HSBC is looking to make steep cost cuts by eliminating jobs and businesses which no longer fit with its focus on Asian growth opportunities. HSBC's focus on China should allow it to be a leaner, higher margin entity. The concern, of course, is that HSBC's future will then be pitted very closely with that of China; and China's growth outlook is on very shaky ground at the moment.

If there's a cheap megacap stock that could get even cheaper, it might be HSBC.

JPMorgan Chase: forward P/E of 9.5
That's right folks, we're going to round this out with our fourth and final money center bank, JPMorgan Chase (JPM -0.40%), which is currently sporting a forward P/E of 9.5.

Image source: JPMorgan Chase.

JPMorgan Chase has done a good job of keeping its nose clean of litigation and energy loans relative to some of its peers (thus its more aggressive forward valuation). However, the threat of rising expenses, along with slowing growth prospects that could induce the Federal Reserve to put off proposed rate hikes a bit further down the road, have recently weighed on JPMorgan's share price.

The good news? The company has taken steps to shore up its bottom-line. It announced the closure of 300 branches, or about 5% of its retail locations, over a two-year period in an effort to save money, as well as steer consumers toward ATM and mobile transactions, which are considerably cheaper for the company than teller-based interactions. JPMorgan Chase is also focusing on higher net worth clients by pushing its private client wealth management services. Couple this new strategy with CEO Jamie Dimon putting his own money into JPMorgan stock, and I believe you have enough evidence to suggest it could head higher.