Overview Of Value Stocks In The Utilities Sector

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.

The following stocks are considered to be notable value stocks in the utilities sector:

1. Kenon Hldgs KEN - P/E: 5.09
2. Cia Paranaense De Energia ELP - P/E: 5.6
3. Central Puerto CEPU - P/E: 6.29
4. China Recycling Energy CREG - P/E: 4.16
5. NRG Energy NRG - P/E: 2.58

Kenon Hldgs has reported Q3 earnings per share at 1.09, which has increased by 5350.0% compared to Q2, which was 0.02. Kenon Hldgs 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 a decrease in earnings per share, which was 1.09 in Q2 and is now 0.46. Most recently, the company reported a dividend yield of 8.62%, which has increased by 2.36% from last quarter's yield of 6.26%.

Central Puerto has been featured as a value stock. Central Puerto's Q3 EPS sits at 0.02, which has not changed since last quarter (Q2). Central Puerto does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

China Recycling Energy saw a decrease in earnings per share from 0.43 in Q2 to -0.25 now. China Recycling Energy does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

This quarter, NRG Energy experienced a decrease in earnings per share, which was 1.27 in Q2 and is now 1.1. Most recently, the company reported a dividend yield of 3.2%, which has decreased by 0.42% from last quarter's yield of 3.62%.

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.