What is 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.
Below is a list of notable value stocks in the communication services sector:
- AMC Networks AMCX - P/E: 4.77
- DoubleDown Interactive DDI - P/E: 6.13
- Hall Of Fame Resort HOFV - P/E: 1.11
- Paramount Global PARA - P/E: 4.37
- AT&T T - P/E: 8.7
This quarter, AMC Networks experienced an increase in earnings per share, which was $0.54 in Q4 and is now $2.54. DoubleDown Interactive's earnings per share for Q1 sits at $0.37, whereas in Q4, they were at 0.35. Most recently, Hall Of Fame Resort reported earnings per share at $-0.08, whereas in Q4 earnings per share sat at $0.13. Paramount Global has reported Q1 earnings per share at $0.6, which has increased by 130.77% compared to Q4, which was 0.26. Most recently, the company reported a dividend yield of 2.55%, which has decreased by 0.13% from last quarter's yield of 2.68%.
AT&T saw a decrease in earnings per share from 0.78 in Q4 to $0.77 now. The company's most recent dividend yield sits at 5.34%, which has increased by 0.57% from 4.77% 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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