Foot Locker, Inc. (FL), Bob Evans Farms Inc (BOBE): These Small Stocks Are Both Value And Income Plays

Stocks that trade for attractive valuations are getting harder to find in today’s market. The Dow Jones Industrial Average and the S&P 500 are teetering near all-time highs. Moreover, the Federal Reserve’s easy monetary policy of low interest rates has helped push up asset prices across the board.

Put it all together, and you’d think that finding reasonably valued stocks is hard to do. You’d think this would be even more difficult amid smaller stocks, which often hold higher valuations than the overall market due to their stronger growth potential. Never fear, investors: there are still a few small stocks out there that aren’t overpriced, and provide the margin of safety of regular dividend payments.

Three candidates to get you started

Bob Evans Farms Inc (NASDAQ:BOBE) reported 1% growth in same-store sales, a measure that includes growth at locations open at least a year, in fiscal 2013. Moreover, the company expects non-GAAP earnings per share to fall between $2.60 and $2.67 in fiscal 2014. The stock trades for 17 times the midpoint of its profit outlook.

Bob Evans Farms Inc (NASDAQ:BOBE) has raised its dividend annually since 2007, and yields roughly 2.3% at current prices. Last year, the company gave its investors a solid 10% dividend hike, and will likely raise its payout again in time for its next quarterly payout.

Aside from the drama surrounding recent events, The Men’s Wearhouse, Inc. (NYSE:MW) has a great story to tell. From its humble beginnings as one small Texas store, the company eventually grew to become one of North America’s biggest men’s clothing stores with more than 1,100 locations. The company also operates the K&G brand.

Total net sales for the first-quarter increased 5.1%, and The Men’s Wearhouse, Inc. (NYSE:MW) achieved 25% growth in diluted earnings per share during the first three months of the year. The company racked up 11% growth in GAAP diluted EPS last year, and is committed to returning meaningful cash to shareholders.

At the end of last year, the company’s Board of Directors approved a new $200 million share buyback program, and the company pays a 2% dividend to shareholders.