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Market Overview

A Look Into Financial Services Sector Value Stocks

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The Meaning Behind 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.

Below is a list of notable value stocks in the financial services sector:

  1. Stewart Information Servs (NYSE:STC) - P/E: 8.4
  2. WhiteHorse Finance (NASDAQ:WHF) - P/E: 9.81
  3. Summit State Bank (NASDAQ:SSBI) - P/E: 9.39
  4. HMN Finl (NASDAQ:HMNF) - P/E: 9.23
  5. Hawthorn Bancshares (NASDAQ:HWBK) - P/E: 9.7

Most recently, Stewart Information Servs reported earnings per share at 2.09, whereas in Q3 earnings per share sat at 2.21. The company's most recent dividend yield sits at 2.8%, which has decreased by 0.07% from 2.87% last quarter.

WhiteHorse Finance has reported Q4 earnings per share at 0.35, which has decreased by 7.89% compared to Q3, which was 0.38. Most recently, the company reported a dividend yield of 9.7%, which has decreased by 3.93% from last quarter's yield of 13.63%.

This quarter, Summit State Bank experienced a decrease in earnings per share, which was 0.49 in Q3 and is now 0.48. Its most recent dividend yield is at 2.83%, which has decreased by 1.04% from 3.87% in the previous quarter.

HMN Finl has been featured as a value stock. HMN Finl's Q4 EPS sits at 0.67, which has not changed since last quarter (Q3). HMN Finl does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Hawthorn Bancshares saw an increase in earnings per share from 0.77 in Q3 to 0.8 now. The company's most recent dividend yield sits at 2.67%, which has increased by 0.01% from 2.66% last 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.

 

Related Articles (HMNF + HWBK)

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Posted-In: BZI-VSEarnings News Dividends Financing

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