5 Big Stocks You Can Buy Dirt Cheap

BALTIMORE (Stockpickr) -- Twenty percent. When earnings and prices are factored in, that's how much cheaper the average S&P 500 stock is this summer vs. last. So when people say "stocks are cheap," there's a pretty big number supporting that claim.

For the past couple of earnings seasons, stock performance has separated from fundamental performance. Even though most stocks handily beat analyst expectations for the fourth quarter of last year and the first quarter of 2012, equity indices have barely budged higher as a result. As an investor, that means that you're paying less, on average, for each dollar of earnings generation that a company can churn out.

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But I have a big problem with platitudes such as "stocks are cheap." That's because, true though the statement may be on average, they don't answer the question of which stocks are cheap. After all, the idea that the market is generally cheaper right now isn't going to help put gains in anyone's portfolio. To do that, we're turning to Wall Street's bargain bin to find the names trading at a discount right now.

In our search, we're focusing in on stocks that currently trade near or under book value per share, a number that (generally) means that a company costs less to buy than the value of the stuff it owns.

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Typically, stocks trade under book value for good reasons. It could mean, for example, that a company has a major black cloud ready to disrupt its businesses, or that its liabilities are underrepresented on its balance sheet. To combat that, we're focusing on larger bargains with consistent profitability, and assets that are primarily financed with equity rather than debt.

Without further ado, here's a look at five big stocks you can buy dirt cheap this summer.

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