What are Value Stocks?
A value stock is traditionally defined in terms of how investors in the marketplace are valuing that company’s future growth prospects. Low P/E multiples are good base indicators that the company is undervalued and can most likely be labelled as a value stock.
The following stocks are considered to be notable value stocks in the basic materials sector:
- Warrior Met Coal (NYSE:HCC) – P/E: 2.53
- CVR Partners (NYSE:UAN) – P/E: 4.31
- Flexible Solutions Intl (AMEX:FSI) – P/E: 9.91
- Nutrien (NYSE:NTR) – P/E: 5.3
- IT Tech Packaging (AMEX:ITP) – P/E: 5.5
Most recently, Warrior Met Coal reported earnings per share at $2.1, whereas in Q2 earnings per share sat at $5.87. CVR Partners has reported Q3 earnings per share at $-1.87, which has decreased by 116.82% compared to Q2, which was 11.12. The company’s most recent dividend yield sits at 5.82%, which has decreased by 30.92% from 36.74% last quarter.
Flexible Solutions Intl’s earnings per share for Q3 sits at $0.09, whereas in Q2, they were at 0.13. Nutrien’s earnings per share for Q3 sits at $2.51, whereas in Q2, they were at 5.85. Its most recent dividend yield is at 2.31%, which has decreased by 0.03% from 2.34% in the previous quarter.
This quarter, IT Tech Packaging experienced a decrease in earnings per share, which was $-0.0 in Q2 and is now $-0.03.
The Significance: A value stock may need some time to rebound from its undervalued position. The risk of investing in a value stock is that this emergence may never materialize.
