What is a Value Stock?
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 labelled as a value stock.
Benzinga Insights has compiled a list of value stocks in the consumer cyclical sector that may be worth watching:
- Hanesbrands (NYSE:HBI) - P/E: 8.45
- Hamilton Beach Brands (NYSE:HBB) - P/E: 5.98
- Standard Motor Products (NYSE:SMP) - P/E: 9.03
- Garrett Motion (NASDAQ:GTX) - P/E: 1.93
- Kirkland's (NASDAQ:KIRK) - P/E: 4.49
Hanesbrands's earnings per share for Q1 sits at $0.34, whereas in Q4, they were at 0.44. Most recently, the company reported a dividend yield of 4.28%, which has increased by 0.48% from last quarter's yield of 3.8%.
This quarter, Hamilton Beach Brands experienced a decrease in earnings per share, which was $0.9 in Q4 and is now $0.51. Its most recent dividend yield is at 4.33%, which has increased by 1.5% from 2.83% in the previous quarter.
Standard Motor Products's earnings per share for Q1 sits at $0.92, whereas in Q4, they were at 0.9. The company's most recent dividend yield sits at 2.52%, which has increased by 0.26% from 2.26% last quarter.
Garrett Motion has reported Q1 earnings per share at $0.15, which has decreased by 40.0% compared to Q4, which was 0.25. Kirkland's has reported Q1 earnings per share at $-0.62, which has decreased by 173.81% compared to Q4, which was 0.84.
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.
