What are 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.
Below is a list of notable value stocks in the healthcare sector:
- Humacyte HUMA - P/E: 0.81
- ITeos Therapeutics ITOS - P/E: 2.85
- Acumen Pharmaceuticals ABOS - P/E: 4.48
- Retractable Technologies RVP - P/E: 1.94
- Novartis NVS - P/E: 9.37
Humacyte saw a decrease in earnings per share from -0.19 in Q2 to $-0.25 now. This quarter, ITeos Therapeutics experienced a decrease in earnings per share, which was $0.15 in Q2 and is now $0.03. Acumen Pharmaceuticals's earnings per share for Q3 sits at $-0.26, whereas in Q2, they were at -0.25. Retractable Technologies has reported Q3 earnings per share at $0.16, which has increased by 245.45% compared to Q2, which was -0.11. The company's most recent dividend yield sits at 13.16%, which has decreased by 0.1% from 13.26% last quarter.
Novartis's earnings per share for Q3 sits at $1.58, whereas in Q2, they were at 1.56. Most recently, the company reported a dividend yield of 2.54%, which has increased by 0.3% from last quarter's yield of 2.24%.
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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