12 High Quality Stocks That Are Near 52-week Lows, Should You Buy?

Markets have recovered a tad bit, over the last 1-week, but, still remain substantially lower than 52-week highs. In the process, there are several stocks that are trading near 52-week lows. Take a look at some such stocks.

List of companies trading near 52-week lows

Name of company	52-week low	Current market price
Lux Industries	1972	2006.25
Just Dial	644.55	661
PNB Housing	311.45	322.95
LIC	801	811
Fortis Healthcare	223	238
Tata Com	906	985
ICICI Lombard	1192	1265
HPCL	226.27	227
NMDC	119.3	126.1
Glaxo Smithkline Pharma	1450.25	1500.95
Divis Labs	3365	3602
REC	115	118.25

Should you buy the shares of these companies trading near 52-week lows?

We would have no hesitation in saying that some of the stocks listed above are worth buying. While all of these companies have a good track record and excellent dividend paying record, some become attractive on account of valuations and some become attractive fundamentally speaking. Take the case of LIC. The stock was offered at an IPO price of Rs 949 and trades at Rs 811. The valuations of the company on various metrics is much better than private sector peers. Another good stock to buy is Tata Communications. The company carries around 30% of the world's internet routes and connects businesses to 60% of the world's cloud giants and 4 out of 5 mobile subscribers. The company's capabilities are underpinned by its global network, the world's largest wholly owned subsea fibre backbone and a Tier-1 IP network with connectivity to more than 200 countries and territories. The stock, which had hit a 52-week high of Rs 1590 on the BSE, is now better priced at Rs 985, which makes the p/e reasonable at 24 times.

HPCL, NMDC and REC are stocks to buy for their dividend yields

If you are looking at dividend yields, then the right stock to buy would be the stock of HPCL, REC and NMDC. The dividend yield on the three stocks based on last year's dividends range from about 7 to near 12%. The discounting on some of these stocks is also ridiculously

Is it worth buying the other stocks listed in the above table?

We do not like Divis Labs as we believe that valuations are not compelling. Also, pharma stocks depend on the US for exports and we do not know when a US FDA warning will come. Despite the fall, Fortis Healthcare and ICICI Lombard stocks are expensive and hence best avoided. A word of caution also needs to be made on the markets, as earnings are likely to be revised lower on account of margin pressures. This is because margins could be eroded on account of cost pressures. 

Disclaimer

Investors are advised caution as the markets have become exceedingly volatile. Neither Greynium Information Technologies, nor the author would be responsible for any losses based on a decision reading the above article. Every effort has been made to provide accurate information and readers should understand the inherent risks before investing in the markets. The author and his family do not own shares of the above companies.