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Zacks.com featured highlights: Teck Resources, Cosan, Pacific Ethanol and KKR

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For Immediate Release

Chicago, IL - January 24, 2017 - Stocks in this week's article include: Teck Resources Limited (NYSE: TECK - Free Report ), Cosan Limited (NYSE: CZZ - Free Report ), Pacific Ethanol, Inc. ( NASDAQ: PEIX - Free Report ) and KKR & Co. L.P. (NYSE: KKR - Free Report ).

Screen of the Week of Zacks Investment Research:

4 High Earnings Yield Stocks for a Winning Portfolio

Investors often use P/E ratio and other valuation metrics while picking undervalued stocks with solid upside potential. However, it is difficult to use the P/E ratio to compare stocks with fixed income securities. This is where earnings yield comes handy.

Earnings yield is calculated as (Annual Earnings per Share/Market Price) x 100. In other words, it is the inverse of P/E ratio.

Other things remaining constant, a stock with higher earnings yield has the potential to provide comparatively greater returns. This metric is also used to compare the performance of a market index with the 10-year Treasury yield as well.

For instance, if the yield of the market index is more than the 10-year Treasury, stocks can be considered as undervalued in comparison to bonds. In such a case, investing in the stock market would be a better option for a value investor. However, given the risk-free nature of T-bills, it would be prudent to add a risk premium to their yield while comparing with a stock or the market index.

The Winning Strategy

We have set Earnings Yield greater than 10% as our primary screening criterion, but it alone cannot be used for picking stocks that have the potential to generate solid returns. So, we have added the following parameters to the screen:

Estimated EPS growth for the next 12 months greater than or equal to the S&P 500: This metric compares the 12-month forward EPS estimate with the 12-month actual EPS.

Average Daily Volume (20 Day) greater than or equal to 100,000: High trading volume implies that a stock has adequate liquidity.

Current Price greater than or equal to $5.

Buy-Rated Stocks: Stocks with a Zacks Rank #1 (Strong Buy) or 2 (Buy) have been known to outperform peers in any type of market environment.

Here are four of the 11 stocks that made it through the screen:

Teck Resources Limited (NYSE: TECK - Free Report ) is a diversified resource company committed to responsible mining and mineral development with major business units focused on copper, metallurgical coal, zinc, gold and energy. The company carries a Zacks Rank #1 and its expected EPS growth rate for the next 3-5 years is 10.7%.

Cosan Limited (NYSE: CZZ - Free Report ) was established as the controlling shareholder of Cosan S.A., a Brazilian company, after the corporate restructuring of the Cosan Group in Brazil. Cosan Limited currently holds roughly 62.3% of the controlling shares of Cosan S.A., which is engaged in the cultivation, harvesting and processing of sugarcane. This Zacks Rank #1 company has an expected EPS growth rate of 16.3% for the next 3-5 years. You can see the complete list of today's Zacks #1 Rank stocks here .

Pacific Ethanol, Inc. ( NASDAQ: PEIX - Free Report ) is currently in the business of marketing ethanol in the Western United States through Kinergy Marketing, a wholly owned subsidiary. This Zacks Rank #2 stock has an expected EPS growth rate of 20% for the next 3-5 years.

KKR & Co. L.P. (NYSE: KKR - Free Report ) provides a range of asset management services to its investors and capital markets services to firms, portfolio companies and other clients. This Zacks Rank #2 company has an expected EPS growth rate of 18.9% for the next 3-5 years.

You can get the rest of the stocks on this list by signing up now for a 2-week free trial to the Research Wizard stock picking and backtesting software. You can also create your own strategies and test them first before making investments.

The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.

Click here to sign up for a free trial to the Research Wizard today .

Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

Disclosure: Performance information for Zacks' portfolios and strategies are available at:https://www.zacks.com/performance.

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About Screen of the Week

Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use. Each week, Zacks Profit from the Pros free email newsletter shares a new screening strategy. Learn more about it here https://at.zacks.com/?id=112

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Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Click here for your free subscription to Profit from the Pros .

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Contact: Jim Giaquinto

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.

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Teck Resources Ltd (TECK): Free Stock Analysis Report

Cosan Limited (CZZ): Free Stock Analysis Report

Pacific Ethanol, Inc. (PEIX): Free Stock Analysis Report

KKR & Co. L.P. (KKR): Free Stock Analysis Report

To read this article on Zacks.com click here.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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