What Defines a Value Stock?
A value stock traditionally has a lower price when compared to stock prices of companies in the same industry. This indicates that the company may be undervalued, as investors are not expressing as much interest in such companies. The most commonly used way to check for value is with the price-to-earnings multiple, or P/E. A low P/E multiple is a good indication that the stock is undervalued.
The following stocks are considered to be notable value stocks in the real estate sector:
- GEO Group GEO - P/E: 8.18
- IRSA Propiedades IRCP - P/E: 1.62
- Kimco Realty KIM - P/E: 8.79
- Optibase OBAS - P/E: 9.21
- Ellington Residential EARN - P/E: 7.56
Most recently, GEO Group reported earnings per share at 0.48, whereas in Q3 earnings per share sat at 0.52. Its most recent dividend yield is at 11.16%, which has decreased by 0.86% from 12.02% in the previous quarter.
IRSA Propiedades saw a decrease in earnings per share from 1.34 in Q1 to -1.22 now. IRSA Propiedades does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
Kimco Realty has reported Q4 earnings per share at 0.31, which has increased by 24.0% compared to Q3, which was 0.25. The company's most recent dividend yield sits at 3.85%, which has decreased by 0.55% from 4.4% last quarter.
Optibase's earnings per share for Q3 sits at 1.0, whereas in Q2, they were at 0.34. Optibase does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
Most recently, Ellington Residential reported earnings per share at 0.34, whereas in Q3 earnings per share sat at 0.39. Its most recent dividend yield is at 9.0%, which has decreased by 0.11% from 9.11% in the previous quarter.
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.
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