Understanding Value Stocks
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.
Benzinga Insights has compiled a list of value stocks in the industrials sector that may be worth watching:
- Globus Maritime GLBS - P/E: 2.42
- Worthington Industries WOR - P/E: 7.14
- Limbach Holdings LMB - P/E: 9.92
- Matson MATX - P/E: 4.45
- CVD Equipment CVV - P/E: 6.9
Most recently, Globus Maritime reported earnings per share at $0.64, whereas in Q3 earnings per share sat at $0.27. Worthington Industries saw a decrease in earnings per share from 2.12 in Q2 to $1.13 now. Its most recent dividend yield is at 1.82%, which has decreased by 0.37% from 2.19% in the previous quarter.
This quarter, Limbach Holdings experienced an increase in earnings per share, which was $0.38 in Q3 and is now $0.41. Matson has reported Q4 earnings per share at $9.39, which has increased by 43.8% compared to Q3, which was 6.53. Most recently, the company reported a dividend yield of 1.27%, which has decreased by 0.18% from last quarter's yield of 1.45%.
CVD Equipment saw a decrease in earnings per share from 0.89 in Q3 to $-0.18 now.
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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