Understanding 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.

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

1. BBQ Hldgs BBQ - P/E: 6.49
2. TRI Pointe Group TPH - P/E: 8.11
3. MGM Resorts Intl MGM - P/E: 5.93
4. The RealReal REAL - P/E: 4.91
5. Sally Beauty Holdings SBH - P/E: 9.4

Most recently, BBQ Hldgs reported earnings per share at -0.21, whereas in Q1 earnings per share sat at -0.09. BBQ Hldgs does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Most recently, TRI Pointe Group reported earnings per share at 0.63, whereas in Q2 earnings per share sat at 0.51. Most recently, the company reported a dividend yield of 0.78%, which has increased by 0.09% from last quarter’s yield of 0.69%.

MGM Resorts Intl’s earnings per share for Q2 sits at -1.52, whereas in Q1, they were at -0.45. Its most recent dividend yield is at 0.06%, which has ('', 'not changed') by 0.0% from 0.06% in the previous quarter.

The RealReal’s earnings per share for Q2 sits at -0.42, whereas in Q1, they were at -0.39. The RealReal does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Sally Beauty Holdings saw a decrease in earnings per share from 0.23 in Q2 to -0.11 now. Sally Beauty Holdings does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

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.