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.
Below is a list of notable value stocks in the financial services sector:
- Donegal Group DGICB - P/E: 7.54
- First Horizon FHN - P/E: 8.1
- TriplePoint Venture Gwth TPVG - P/E: 9.08
- Virtu Financial VIRT - P/E: 5.51
- Hennessy Advisors HNNA - P/E: 9.93
Donegal Group's earnings per share for Q1 sits at 0.26, whereas in Q4, they were at 0.39. Most recently, the company reported a dividend yield of 3.85%, which has decreased by 0.13% from last quarter's yield of 3.98%.
First Horizon saw an increase in earnings per share from 0.46 in Q4 to 0.51 now. Its most recent dividend yield is at 3.32%, which has decreased by 0.96% from 4.28% in the previous quarter.
TriplePoint Venture Gwth saw a decrease in earnings per share from 0.39 in Q4 to 0.29 now. Its most recent dividend yield is at 9.16%, which has decreased by 0.76% from 9.92% in the previous quarter.
Most recently, Virtu Financial reported earnings per share at 2.04, whereas in Q4 earnings per share sat at 1.18. Most recently, the company reported a dividend yield of 3.24%, which has decreased by 0.06% from last quarter's yield of 3.3%.
Hennessy Advisors has reported Q2 earnings per share at 0.26, which has increased by 8.33% compared to Q1, which was 0.24. The company's most recent dividend yield sits at 5.95%, which has decreased by 0.03% from 5.98% last 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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