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.
The following stocks are considered to be notable value stocks in the industrials sector:
- USA Truck (NASDAQ:USAK) - P/E: 8.06
- Digital Ally (NASDAQ:DGLY) - P/E: 3.56
- Matson (NYSE:MATX) - P/E: 8.52
- USD Partners (NYSE:USDP) - P/E: 6.52
- Advanced Emissions Solns (NASDAQ:ADES) - P/E: 3.47
USA Truck has reported Q2 earnings per share at 0.5, which has increased by 16.28% compared to Q1, which was 0.43. USA Truck does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
Most recently, Digital Ally reported earnings per share at -0.1, whereas in Q1 earnings per share sat at 0.49. Digital Ally does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
Matson's earnings per share for Q2 sits at 3.71, whereas in Q1, they were at 1.99. Most recently, the company reported a dividend yield of 1.9%, which has increased by 0.54% from last quarter's yield of 1.36%.
USD Partners saw a decrease in earnings per share from 0.26 in Q1 to 0.24 now. The company's most recent dividend yield sits at 6.97%, which has decreased by 1.12% from 8.09% last quarter.
Advanced Emissions Solns has reported Q2 earnings per share at 0.9, which has increased by 20.0% compared to Q1, which was 0.75. The company's most recent dividend yield sits at 8.48%, which has increased by 0.64% from 7.84% 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.