What are Value Stocks?
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 labeled as a value stock.
The following stocks are considered to be notable value stocks in the utilities sector:
- Pampa Energia PAM - P/E: 0.04
- Cia Paranaense De Energia ELP - P/E: 5.46
- Spark Energy SPKE - P/E: 5.33
- Central Puerto CEPU - P/E: 2.83
- Enel Americas ENIA - P/E: 6.88
Pampa Energia’s earnings per share for Q2 sits at 0.06, whereas in Q1, they were at 0.21. Pampa Energia does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
This quarter, Cia Paranaense De Energia experienced an increase in earnings per share, which was 0.42 in Q1 and is now 1.09. The company’s most recent dividend yield sits at 6.26%, which has increased by 4.11% from 2.15% last quarter.
This quarter, Spark Energy experienced an increase in earnings per share, which was 0.2 in Q1 and is now 0.62. Most recently, the company reported a dividend yield of 10.35%, which has increased by 0.18% from last quarter’s yield of 10.17%.
Central Puerto saw an increase in earnings per share from 0.01 in Q1 to 0.02 now. Central Puerto does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
Enel Americas saw a decrease in earnings per share from 0.0 in Q1 to 0.0 now. Its most recent dividend yield is at 11.07%, which has increased by 9.39% from 1.68% in the previous 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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