The Meaning Behind 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.
Benzinga Insights has compiled a list of value stocks in the real estate sector that may be worth watching:
- Newmark Group NMRK - P/E: 4.96
- KKR Real Estate Finance KREF - P/E: 9.67
- Ares Commercial Real ACRE - P/E: 8.55
- PennyMac Mortgage PMT - P/E: 6.98
- Arbor Realty Trust ABR - P/E: 6.82
Newmark Group has reported Q2 earnings per share at 0.31, which has increased by 55.0% compared to Q1, which was 0.2. Most recently, the company reported a dividend yield of 0.32%, which has decreased by 0.05% from last quarter's yield of 0.37%.
This quarter, KKR Real Estate Finance experienced a decrease in earnings per share, which was 0.55 in Q1 and is now 0.54. Its most recent dividend yield is at 7.52%, which has decreased by 1.46% from 8.98% in the previous quarter.
Ares Commercial Real's earnings per share for Q2 sits at 0.37, whereas in Q1, they were at 0.4. Ares Commercial Real does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
Most recently, PennyMac Mortgage reported earnings per share at 0.32, whereas in Q1 earnings per share sat at 0.67. Its most recent dividend yield is at 8.98%, which has decreased by 0.82% from 9.8% in the previous quarter.
Arbor Realty Trust's earnings per share for Q2 sits at 0.45, whereas in Q1, they were at 0.52. Its most recent dividend yield is at 7.73%, which has decreased by 0.15% from 7.88% 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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