Most investment analysis tries to put a company into either a growth category, or a value category. Fortunately, some stocks offer both at the same time. With some sectors of the market rallying strongly and value out of reach, being able to buy value while also seeing a move higher is huge.
And with a solid valuation, the share price can move higher from both higher earnings growth and a higher valuation multiple as the company grows.
One company exhibiting this growth now is Oxford Industries (OXM). Trading at less than 10 times earnings, and yielding about 2.5 percent, it sounds like a value play.
But the apparel manufacturer and parent company for brands such as Tommy Bahamas is growing earnings and revenues by nearly 30 percent each. That’s well into growth territory, especially amid a slow economy.
Action to take: Investors may like shares in the $100 range or on any drop lower as a long-term buy. The dividend yield is slightly above average compared to the overall market, and has a history of recent growth. The S&P 500 trades at over 20 times earnings, suggesting that shares are undervalued by around 50 percent on an earnings basis alone.
For traders, the October $120 calls, last going for about $3.10, offer mid-double-digit return potential on a continued rally in the coming months.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.