(MONEY Magazine) – Norman Weinger and Michael Metz of Oppenheimer & Co. in New York City regularly screen their brokerage firm's recommended list for the stocks that rate best by value-oriented measures. Such stocks typically have low prices compared with their earnings and book values and often pay high yields. MONEY recently asked Weinger, Oppenheimer's director of special research, to select three of those value picks that would be smart buys for income investors. Weinger's recommendations all pay 3.8% or more and trade at P/Es of less than 14 times estimated 1994 earnings. He figures that the three stocks could turn in capital gains of at least 10% to 12% over the next 12 months. Here's a quick look at the stocks, which trade on the NYSE, starting with the top yielder: General Public Utilities (symbol: GPU; $33.75; 5% yield). The partial meltdown of nuclear unit No. 2 at Three Mile Island in 1979 forced the company to slash -- and then eliminate -- its dividend. Since then, says Oppenheimer analyst Craig Lucas, "GPU has taken all the write-offs related to the accident, and earnings have rebounded."

Once GPU was on the mend, it reinstated its dividend. The payout, however, was set fairly low, says Lucas, leaving the company with ample cash to fund future growth. In fact, the Parsippany, N.J. company, with annual revenues of $3.4 billion, pays out only 66% of its earnings, compared with an average 80% dividend payout ratio for the industry. That means, says Lucas, that GPU will be able to raise its dividend by about 5.7% annually, compared with an industry average of 2.2%. Washington National (WNT; $23.25; 4.6%). After tumbling to $10 a share , during the 1990-91 recession because of losses on individual health insurance lines and investors' concerns that the company was overinvested in risky junk bonds and mortgages, Washington National rallied to $28 earlier this year. The reasons: The company has been marketing its individual health policies more successfully (they accounted for nearly a third of Washington National's $222 million premium income in the first half of 1993) and has steadily whittled away at its junk bonds and mortgage holdings (they are now down to 23.4% of total invested assets, compared with 25% last year). Nonetheless, the stock has backed off by almost $5 in the past few months owing to uncertainty about health-care reform and also because of the company's announcement that it would sell 2 million shares of new stock in August. As one of the underwriters, Oppenheimer is restricted from commenting on Washington National's outlook, but Oppenheimer analysts Myron Picoult and John O'Neil have been recommending the stock. Value Line, which also rates the issue above average, notes that demand for individual health policies is strong and projects that the insurer's net profit will increase 33% this year and another 13% next year. Chevron (CHV; $93; 3.8%). Despite soft oil prices, Chevron has climbed to a 52-week high. Still, many analysts continue to recommend it, in part because the firm has been restructuring. "Annual operating costs have been reduced by $600 million in the past year," says Oppenheimer analyst Paul B. Ting, "and Chevron plans more cuts."

In addition, the company has two attractive growth areas. First, it plans to direct more resources to natural gas, a fuel with brighter prospects than oil. Second, Chevron has a leading position in the former Soviet republic of Kazakhstan, which has immense oil reserves. Chevron's share of output from the Tengiz field near the Caspian Sea is running 15,000 barrels a day and could top 65,000 by 1995. That's what you call a giant steppe.