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.
Below is a list of notable value stocks in the basic materials sector:
- LSB Industries (NYSE:LXU) – P/E: 4.0
- ArcelorMittal (NYSE:MT) – P/E: 2.67
- Nexa Res (NYSE:NEXA) – P/E: 3.67
- Ramaco Resources (NASDAQ:METC) – P/E: 3.33
- Constellium (NYSE:CSTM) – P/E: 6.55
LSB Industries has reported Q4 earnings per share at $0.9, which has increased by 233.33% compared to Q3, which was 0.27. This quarter, ArcelorMittal experienced a decrease in earnings per share, which was $1.11 in Q3 and is now $0.3. Most recently, the company reported a dividend yield of 1.28%, which has increased by 0.51% from last quarter’s yield of 0.77%.
Nexa Res saw an increase in earnings per share from -0.37 in Q3 to $-0.04 now. Ramaco Resources has reported Q4 earnings per share at $0.32, which has decreased by 46.67% compared to Q3, which was 0.6. The company’s most recent dividend yield sits at 4.55%, which has decreased by 0.46% from 5.01% last quarter.
Most recently, Constellium reported earnings per share at $0.2, whereas in Q3 earnings per share sat at $0.89.
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.
