A $700,000 house would be suspiciously cheap in Alpine, N.J., where even today the median house price is about $4 million. Similarly, with the S&P 500 index trading at a ritzy 19 times this year s operating earnings forecast, the stocks below leave an investor wondering what s wrong. They have price/earnings ratios in the single digits.

However, these fixer-uppers are at least worth a look. Their problems are significant but seem manageable, and their dividend yields top 2%.

Aflac

Based in Columbus, Ga., Aflac offers standard life insurance but specializes in supplemental coverage. Some of its policies cover specific diseases like cancer and others cover events like strokes. Some pay medical costs and others provide spending money. The company does business chiefly in Japan and the U.S., two troubled economies of which one, Japan, is fairly saturated with private insurance. Aflac s specialized products make it more profitable than the average insurer, and the company s stock price has grown over the past two decades from $2 to $45 despite a long recession in Japan. But then, the stock briefly plunged below $12 earlier this year, because insurers can take a beating in their investment portfolios during economic downturns, which can panic stockholders. Management has lately worked to strengthen the Aflac s balance sheet and profits are growing nicely at the moment. Barring another financial crisis, the stock seems priced to outperform at less than 10 times earnings with a 2.6% dividend yield.

Eli Lilly

Along with a suspiciously low price of eight times earnings, Eli Lilly carries a giant dividend yield of 5.3%. The company has paid dividends for more than 120 years and has increased payments annually for more than four decades, and its dividend payment works out to less than half this year s profit forecast, suggesting affordability. However, none of that guarantees the dividend won t get slashed to fund acquisitions. Like most big drug makers, Lilly must contend with looming patent expirations for blockbuster drugs Zyprexa (a schizophrenia treatment) in 2011 and Cymbalta (a depression drug) in 2013. Effient, a blood thinner designed to reduce the risk of heart attack, was approved in July and should by now be stealing market share from Plavix, made by Sanofi Aventis and Bristol-Myers Squibb. It s off to a slow start, though; a required warning label on the risk of excessive bleeding probably isn t helping. Management is working to reduce operating costs by $1 billion and find growth opportunities treating cancer and diabetes. Just over a year ago, Lilly bought cancer specialist ImClone for $6.5 billion.

Supervalu

Struggling grocer Supervalu (SVU) got a new boss in May. Craig Herkert, a former Wal-Mart executive, faces a difficult turnaround effort. Supervalu s sales at longstanding stores have been shrinking for more than a year. Herkert plans to expand the company s most profitable chain, Save-A-Lot, which offers a limited assortment of goods but also deeper discounts. He ll also centralize purchasing at the company s headquarters in Minneapolis in order to negotiate for lower prices. A debt load of more than $8 billion makes Supervalu less than nimble, but the company is on pace for $700 million in debt reduction this year. It is selling assets where it can and has halved the dividend payment. The remaining half makes for a yield of 2.5%. Shares trade at seven times earnings.