"I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful." -- Warren Buffett

Can't argue with that, can you? I don't need to remind you of how much fear is in the market these days. It's a real gut check, but that fear is creating incredible opportunities for investors patient and diligent enough to search for the babies thrown out with the bathwater.

Using our Motley Fool CAPS ranking system's screening tool, I scanned for bargain companies with the following characteristics:

  • Five-star ratings -- the highest our CAPS community offers.
  • Trailing dividend yields of at least 3%.
  • Price-to-book ratios no greater than 1.
  • Dreadful performance over the past 26 weeks, meaning at least a 30% loss. Yes, most stocks meet this condition, but I'm looking for the big crashers. The complete capitulators. The mothers and fathers of all bargains.

Among others, I dug up these five, which have been shredded to such paltry levels that it's hard to keep ignoring 'em:


Price Change


Price/Book Ratio

2009 earnings estimates

Allegheny Technologies (NYSE:ATI)





ConocoPhillips (NYSE:COP)





NamTai Electronics (NYSE:NTE)





Otter Tail (NASDAQ:OTTR)





Pacific Airport Group (NYSE:PAC)





Data from Motley Fool CAPS, Yahoo! Finance, and Capital IQ, as of Feb. 5, 2009. TTM = Trailing 12 months.

None of these are necessarily recommendations -- just good starting points for you to dig a little deeper. You can rerun an update of this screen yourself, if you like (note that, as the market changes, your results may be different).

Chasing the Otters
Shares of Otter Tail are down over 50% since last summer as the allure of wind power fell off a cliff. With global energy prices in the tank, the incentive to push alternative energy is a fraction of what it used to be. That's why you don't see T. Boone Pickens on TV anymore. Poor guy.

Even so, more than a few investors see this stock as a compelling value at today's prices. One of 'em is Microsoft (NASDAQ:MSFT) chairman Bill Gates, whose investment vehicle recently added 850,000 shares to its existing stake. You could probably do worse than following one of the world's richest men.

Our CAPS community is bullish on this diversified giant as well. As NDSuperman posted last month, Otter Tail has quite a bit more than just wind up its sleeve:

Well diversified. Coal or wind. Industrialists or enviornmentalists. This energy company has it all. It does not stop with energy either. They've branched into a wide variety of other applications such as transportation, health, manufacturing, plastics, commercial and idustrial water and waste water treatment and power generation, and others.

In fact, over the past 12 months, Otter Tail pulled in revenue from a slew of different business lines. Have a look:


Revenue (latest 12 months)


$340.0 million


$116.4 million


$470.5 million

Health services

$122.5 million

Food processing

$65.4 million


$199.5 million

Data from company earnings release.

For value-seeking investors, wind power still seems to be the big draw here. Alternative energy plays like Otter Tail and Sasol (NYSE:SSL) are part of a peculiar group of companies that went from no-brainer to portfolio-drainer in a matter of months. Just last summer, the theory was rock-solid: Petroleum-based products are limited; our thirst for them is not. What changed? Investors' attitudes, and an inevitably temporary fall in energy prices. That's it. While impaired in the short run, the energy story will ultimately hold true for patient investors who know that the big story of the next generation still likely lies within this sector. As CAPS member Zappy01 wrote last month:

This company has some involvement with the electric generation from wind industry. I believe this market will resume growth before 2014 probably in connection with a rapid rise in oil prices (as we saw in 2007-2008). The current political climate in Washington also suggests increased funding for renewable energy projects.

Take it from here
Disagree? See it in another light? Just want to see what the rest of the pack is saying? More than 125,000 investors use CAPS to share ideas and swap opinions. Click here to check it out. It's 100% free to participate.

For further Foolishness:

Fool contributor Morgan Housel doesn't own shares in any of the companies mentioned in this article. Sasol and Nam Tai Electronics are Global Gains picks. Pacific Airport and Otter Tail are Motley Fool Hidden Gems selections. Sasol is a Income Investor pick. Microsoft is an Inside Value recommendation. The Motley Fool is investors writing for investors.