Apollo Group Inc (APOL), Western Digital Corp. (WDC), Seagate Technology PLC (STX): The 5 Cheapest Stocks in the Market

With the S&P 500 having hit a new all-time high on Thursday, many investors are thinking about getting back into the stock market. But concerns about whether the market might be poised for a downturn have investors looking for good bargains.

With that in mind, I found five S&P 500 companies that are trading at particularly attractive valuations right now, according to the latest price-to-earnings figures from S&P Capital IQ. Yet before you simply go and buy all five stocks, let’s take a closer look to see if they’re actually a good value for investors right now.

Apollo Group Inc (NASDAQ:APOL)

Apollo Group Inc (NASDAQ:APOL), 5.43 P/E

Apollo Group Inc (NASDAQ:APOL) is the company behind the popular online for-profit giant University of Phoenix. The entire for-profit educational industry has faced difficult times recently, as falling enrollment and rising student-loan default rates among graduates have led to investor concerns as well as inquiries from government entities and other regulatory authorities.

In part because of those enrollment pressures, profits at Apollo Group Inc (NASDAQ:APOL) are expected to drop by about 25% in fiscal 2013 compared with last year. Yet the real overhang on shares is the threat of more draconian measures from regulators that could endanger the entire business model on which Apollo Group Inc (NASDAQ:APOL) and its peers operate. If you’re willing to take on that risk and believe that for-profit education will survive and recover, then Apollo shares look quite inexpensive.

Western Digital Corp. (NASDAQ:WDC) and Seagate Technology PLC (NASDAQ:STX), 6.04 and 4.76 P/Es
The fortunes of these two companies are strongly linked, given their joint history in dominating the hard-disk-drive space. What’s sent these stocks downward is the precipitous drop in PC demand, with an accompanying drop in demand for the hard-drives that typically accompany PCs.

Still, the companies have two viable strategies going forward. First, the rise of the cloud-computing Big Data initiative has increased the need for high-volume storage mechanisms, and that could lead to a resurgence in hard-drive demand for purposes that don’t need the higher speeds available from alternative media. Second, both companies have looked to hybrid solid-state hard drives to try to combine high-speed features for key elements like faster boot-up speed with the more cost-effective storage capacity available from traditional hard drives. If either of these strategies proves successful, then both Western Digital Corp. (NASDAQ:WDC) and Seagate Technology PLC (NASDAQ:STX) should be able to limit their future earnings declines and even potentially begin to grow again.