Top 5 Lowest P/E Ratios of the S&P 500

1. Lumen Technologies, Inc. (NYSE:LUMN)

P/E Ratio: 2.95

Number of hedge fund holders: 34

Lumen Technologies, Inc. (NYSE:LUMN) is a Louisiana-based company operating in the telecom industry. It is one of the top 25 stocks with lowest PE ratios in the S&P 500 index. In November, Lumen Technologies, Inc. (NYSE:LUMN) fell after the company posted weak Q3 results and terminated its dividend. Lumen Technologies, Inc. (NYSE:LUMN) said it plans to move towards share buybacks.

As of the end of the third quarter, 34 hedge funds tracked by Insider Monkey had stakes in Lumen Technologies, Inc. (NYSE:LUMN).

Here is what Longleaf Partners specifically said about Lumen Technologies, Inc. (NYSE:LUMN) in its Q3 2022 investor letter:

“Lumen Technologies, Inc. (NYSE:LUMN) – Global fiber company Lumen was the top detractor in the quarter. In September, the company announced a new CEO, Kate Johnson, would take over for Jeff Storey. Johnson has a strong track record of delivering organic revenue growth, the primary area where Lumen has struggled. Johnson held previous roles at GE and Microsoft, where she most recently served as head of Microsoft US and doubled her division’s revenue in only four years. Multiple checks through our network vouch for her and suggest this leadership change is a positive upgrade that will bring the discipline and focus on sales that Lumen has been missing. The market reacted negatively with concern over the potential for another dividend cut or strategy change. We are confident the stock price reaction is highly overblown versus any impact that a potential dividend cut would have on value per share. The stock now trades at 4.5x EBITDA, and we believe the best value accretive capital allocation move today is share repurchase. Shortly after quarter end, Lumen closed on the sale of part of its consumer business to Apollo, further improving its balance sheet and business mix.”

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