What is a Value Stock?
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.
The following stocks are considered to be notable value stocks in the utilities sector:
- Clearway Energy CWEN - P/E: 7.88
- UGI UGI - P/E: 6.38
- OGE Energy OGE - P/E: 8.9
- NRG Energy NRG - P/E: 2.69
- Kenon Hldgs KEN - P/E: 1.75
Most recently, Clearway Energy reported earnings per share at $-4.37, whereas in Q1 earnings per share sat at $-0.28. The company's most recent dividend yield sits at 3.84%, which has decreased by 0.67% from 4.51% last quarter.
This quarter, UGI experienced a decrease in earnings per share, which was $1.91 in Q2 and is now $0.06. Its most recent dividend yield is at 3.35%, which has decreased by 0.71% from 4.06% in the previous quarter.
OGE Energy saw a decrease in earnings per share from 1.39 in Q1 to $0.36 now. Most recently, the company reported a dividend yield of 4.11%, which has decreased by 0.45% from last quarter's yield of 4.56%.
NRG Energy saw a decrease in earnings per share from 7.17 in Q1 to $2.16 now. Most recently, the company reported a dividend yield of 3.92%, which has increased by 0.39% from last quarter's yield of 3.53%.
Kenon Hldgs's earnings per share for Q1 sits at $11.86, whereas in Q4, they were at 7.28.
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.
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.