With the market volatility ramping up this week, many investors may be looking at their portfolios and wondering if it isn’t time to make some year-end moves. Dividend stocks have suffered this year, and most of the positive upside in the S&P 500 has come from just three momentum stocks.

Each week we cover the new value calls from the analysts at Jefferies, and increasingly some of the calls may look surprising as some solid, big blue chip companies are becoming so cheap on a multiple basis they are ending up in the value arena. This is the best of both worlds for investors, when large cap growth companies become inexpensive enough to have a value call.

Here are three of this week’s value stocks to buy from Jefferies. All are rated Buy.

Abbott Laboratories

This top pharmaceutical stock has very solid growth potential, and was just upgraded to a Buy rating at Jefferies. Abbott Laboratories (NYSE: ABT) is a leading diversified global health care company that develops, manufactures and markets branded generics, medical devices, nutritional products and diagnostic solutions. It recently agreed to acquire the equity in Minnesota-based Tendyne Holdings that it does not already own for $250 million plus future payments tied to regulatory milestones. Wall Street likes the purchase and the way the company is putting its substantial balance sheet to work.

Abbott Labs also offers a diversified large-cap play as earnings are split between five well-positioned business segments: Nutritionals (31% of revenues), Vascular (13%), Generic Pharmaceuticals (20%) and Diagnostics (25.5%) and Diabetes (10.5%).

Abbott Labs posted solid third-quarter earnings, and the emerging market sale growth continues to impress. Wall Street analysts have advised investors since the August sell-off to stay with the company. The Jefferies team says emerging market weakness has raised concerns, but they point out it is defensive in nature and they expect a 12% compounded annual growth rate going forward. They also see the stock at a 20% discount to peers.

Abbott Labs investors receive a 2.28% dividend. The Jefferies price target for the stock is $55, and the Thomson/First Call consensus target is $51.32. Shares closed Thursday at $45.26.
Texas Capital BancShares

This leading midcap bank is in a very strong area of the country economically. Texas Capital BancShares Inc. (NASDAQ: TCBI) is the parent company of Texas Capital Bank, a commercial bank that delivers highly personalized financial services to businesses and entrepreneurs. Headquartered in Dallas, the bank has full-service locations in Austin, Dallas, Fort Worth, Houston and San Antonio. With all those markets showing outstanding growth, and economies stronger than much of the country, the opportunities for a local bank run by well-known Texans is huge.

Jefferies sees the company as a top pick given loan growth and exposure to pending rate hikes as much of the loans are floating rate and C&I. They also note that the bank’s exposure to energy loans is only 7% and not growing. Also 73% of the oil borrowers have accretive hedges in place for next year, which should carry them to 2017 and a rise in prices.

Jefferies has $64 price target, and the consensus target is $60.17. The shares closed most recently at $48.08.

Wells Fargo

This large cap bank is another stock for investors to look at now for safety and dividends. Wells Fargo & Co. (NYSE: WFC) is a nationwide, diversified, community-based financial services company with $1.8 trillion in assets. It provides banking, insurance, investments, mortgage and consumer services and commercial finance through 8,700 locations, 12,800 ATMs, the Internet and mobile banking, and it has offices in 36 countries to support customers who conduct business in the global economy. Wells Fargo serves one in three households in the United States.

Wells Fargo has slowly but surely become one of the biggest mortgage lending companies in the United States, in addition to its normal banking and brokerage businesses. A continued increase in commercial real estate lending could really boost the bank’s bottom line. The analysts feel that could aid a big return in capital to shareholders. The stock also remains a top Warren Buffett holding.

Jefferies likes the stability, yield and some asset sensitivity that the big bank offers, and investors looking to add financials to their portfolio could do well buying shares, knowing that the bank has little exposure outside of the United States. The analysts do note that 2016 could be a transitional year, with slow earnings growth, and expenses could run higher due to the GE acquisitions and tech and cyber upgrades.

Wells Fargo shareholders receive a solid 2.73% dividend. The $59 Jefferies price target is near the consensus target of $58.55. Shares closed Thursday at $55.47.

These stocks offer investors outstanding entry points into companies with well-established franchises. In what still may be a pricey market, they make good sense for growth accounts looking to add value, and they are far safer than high-volatility momentum stocks.

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