Dow Jones Bear Market: This Industrial Stock Is a Smart Buy
The stock market has been anything but calm over the past year, with the broader market falling into a bear market. Since that point the Dow Jones and the S&P 500 have floundered around quite a bit, making it hard to push the buy button on anything. However, some companies, including A. O. Smith (NYSE: AOS), have fallen deep into bear markets of their own. Here's why this particular industrial stock could be a smart buy.
Over the past year the Dow Jones is down around 7.5%. The S&P 500 Index is off about 18%. And A. O. Smith's stock has fallen a far more dramatic 31%. There's been a fair amount of volatility over that 12-month span, but it is clear that A. O. Smith is lagging far behind the broader indexes, languishing deep within bear market territory.
Part of that is related to a material price gain in 2021. So you could just say the stock is giving up outsize gains, but there's more to the story here. A. O. Smith's dividend yield is at the high end of its range over the past decade. That suggests that it is relatively cheap, historically speaking. On an absolute basis, the yield is around 2.1% right now. It's better than the yield on the S&P 500 Index, but that may not get dividend investors excited in and of itself.
Source Fool.com
