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 defensive sector that may be worth watching:

1. Mannatech MTEX - P/E: 4.97
2. Big Lots BIG - P/E: 2.72
3. SpartanNash SPTN - P/E: 9.55
4. Sprouts Farmers Market SFM - P/E: 9.57
5. BellRing Brands BRBR - P/E: 5.77

Mannatech’s earnings per share for Q3 sits at 0.76, whereas in Q2, they were at 0.47. The company’s most recent dividend yield sits at 3.63%, which has increased by 0.24% from 3.39% last quarter.

Big Lots saw an increase in earnings per share from 1.26 in Q1 to 2.75 now. Its most recent dividend yield is at 2.15%, which has decreased by 0.93% from 3.08% in the previous quarter.

SpartanNash’s earnings per share for Q3 sits at 0.7, whereas in Q2, they were at 0.73. Its most recent dividend yield is at 3.85%, which has increased by 0.11% from 3.74% in the previous quarter.

Sprouts Farmers Market saw a decrease in earnings per share from 0.59 in Q2 to 0.52 now. Sprouts Farmers Market does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

BellRing Brands has reported Q4 earnings per share at 0.25, which has increased by 212.5% compared to Q3, which was 0.08. BellRing Brands 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.