A Look Into Energy Sector Value Stocks

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.

Benzinga Insights has compiled a list of value stocks in the energy sector that may be worth watching:

1. Pyxis Tankers PXS - P/E: 2.01
2. Seadrill SDRL - P/E: 0.7
3. PBF Energy PBF - P/E: 2.1
4. Frontline FRO - P/E: 5.57
5. Callon Petroleum CPE - P/E: 2.38

This quarter, Pyxis Tankers experienced a decrease in earnings per share, which was $0.71 in Q1 and is now $0.23. Seadrill saw an increase in earnings per share from 0.83 in Q1 to $1.16 now. The company's most recent dividend yield sits at 11.1%, which has increased by 2.32% from 8.78% last quarter.

PBF Energy's earnings per share for Q2 sits at $2.29, whereas in Q1, they were at 2.76. Its most recent dividend yield is at 1.69%, which has decreased by 0.86% from 2.55% in the previous quarter.

Most recently, Frontline reported earnings per share at $0.94, whereas in Q1 earnings per share sat at $0.87. Its most recent dividend yield is at 15.82%, which has increased by 14.5% from 1.32% in the previous quarter.

Callon Petroleum has reported Q2 earnings per share at $1.99, which has increased by 2.58% compared to Q1, which was 1.94.

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.