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Market Overview

5 Value Stocks To Watch In The Basic Materials Sector


What Defines a Value Stock?

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.

Below is a list of notable value stocks in the basic materials sector:

  1. Ternium (NYSE:TX) - P/E: 8.17
  2. Kinross Gold (NYSE:KGC) - P/E: 6.08
  3. Tronox Holdings (NYSE:TROX) - P/E: 2.66
  4. FutureFuel (NYSE:FF) - P/E: 5.55
  5. Celanese (NYSE:CE) - P/E: 8.41

Most recently, Ternium reported earnings per share at 2.11, whereas in Q3 earnings per share sat at 0.74. The company's most recent dividend yield sits at 5.67%, which has increased by 1.85% from 3.82% last quarter.

Kinross Gold saw an increase in earnings per share from 0.25 in Q3 to 0.27 now. Its most recent dividend yield is at 1.63%, which has increased by 0.17% from 1.46% in the previous quarter.

Tronox Holdings's earnings per share for Q4 sits at 0.19, whereas in Q3, they were at 0.05. Most recently, the company reported a dividend yield of 1.59%, which has decreased by 1.03% from last quarter's yield of 2.62%.

FutureFuel saw a decrease in earnings per share from 0.35 in Q2 to 0.16 now. The company's most recent dividend yield sits at 1.91%, which has ('', 'not changed') by 0.0% from 1.91% last quarter.

This quarter, Celanese experienced an increase in earnings per share, which was 1.95 in Q3 and is now 2.09. Its most recent dividend yield is at 2.28%, which has increased by 0.15% from 2.13% 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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Posted-In: BZI-VSEarnings News Dividends

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