The Meaning Behind 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. Cannae Holdings CNNE - P/E: 2.3
2. Yunji YJ - P/E: 7.6
3. Allison Transmission ALSN - P/E: 9.87
4. M/I Homes MHO - P/E: 7.75
5. The RealReal REAL - P/E: 5.49

Cannae Holdings has reported Q2 earnings per share at 0.46, which has decreased by 64.62% compared to Q1, which was 1.3. Cannae Holdings does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Yunji looks to be undervalued. It possesses an EPS of -0.0, which has not changed since last quarter (Q1). Yunji does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Allison Transmission saw a decrease in earnings per share from 1.2 in Q1 to 0.2 now. Most recently, the company reported a dividend yield of 1.8%, which has decreased by 0.11% from last quarter’s yield of 1.91%.

Most recently, M/I Homes reported earnings per share at 1.89, whereas in Q1 earnings per share sat at 1.09. M/I Homes does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Most recently, The RealReal reported earnings per share at -0.42, whereas in Q1 earnings per share sat at -0.39. The RealReal 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.