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 labelled as a value stock.
Benzinga Insights has compiled a list of value stocks in the financial services sector that may be worth watching:
- Chemung Financial (NASDAQ:CHMG) - P/E: 8.27
- Five Star Bancorp (NASDAQ:FSBC) - P/E: 9.92
- Meta Financial Group (NASDAQ:CASH) - P/E: 8.94
- loanDepot (NYSE:LDI) - P/E: 3.9
- OFS Credit (NASDAQ:OCCI) - P/E: 3.24
This quarter, Chemung Financial experienced a decrease in earnings per share, which was $1.42 in Q3 and is now $1.38. The company's most recent dividend yield sits at 2.67%, which has decreased by 0.03% from 2.7% last quarter.
Five Star Bancorp saw an increase in earnings per share from 0.64 in Q3 to $0.66 now. Most recently, the company reported a dividend yield of 2.11%, which has decreased by 0.32% from last quarter's yield of 2.43%.
Most recently, Meta Financial Group reported earnings per share at $0.78, whereas in Q4 earnings per share sat at $0.5. Its most recent dividend yield is at 0.37%, which has increased by 0.05% from 0.32% in the previous quarter.
loanDepot's earnings per share for Q4 sits at $0.09, whereas in Q3, they were at 0.46. The company's most recent dividend yield sits at 8.72%, which has increased by 1.28% from 7.44% last quarter.
OFS Credit has reported Q1 earnings per share at $0.78, which has increased by 13.04% compared to Q4, which was 0.69. The company's most recent dividend yield sits at 17.2%, which has increased by 0.66% from 16.54% 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.
