What is a value stock?
A value stock traditionally has a lower price than stocks of companies in the same industry. This indicates that the company may be undervalued because investors are not showing as much interest in these companies. The most common way to check value is through the price/earnings multiple, or P/E. A low P/E multiple is a good indication that the stock is undervalued.
Benzinga Insights has compiled a list of value stocks in the consumer cyclical sector that may be worth watching:
- Lazydays Hldgs LAZY – PER: 2.9
- Goodyear tire and rubber GT – PER: 3.66
- Escalation ESCA – PER: 7.04
- Cos Haverty Furniture HVT – PER: 5.23
- Capri Holdings IRCP – PER: 8.98
This quarter, Lazydays Hldgs saw an increase in earnings per share, which was $0.99 in the fourth quarter and is now $1.17. Goodyear Tire & Rubber’s earnings per share for the first quarter came in at $0.37, while in the fourth quarter it was 0.57. Its most recent dividend yield is 4.27%, down 0.52% from 4.79% in the previous quarter.
This quarter, Escalade saw an increase in earnings per share, which was $0.36 in Q4 and is now $0.49. Most recently, the company announced a dividend yield of 4.59%, up 0.2% from last quarter’s 4.39% yield.
This quarter, Haverty Furniture Cos saw a decline in earnings per share, which was $1.35 in the fourth quarter and is now $1.11. Most recently, the company announced a dividend yield of 3.98%, up 0.29% from last quarter’s 3.69% yield.
This quarter, Capri Holdings saw lower earnings per share, which was $2.22 in Q3 and is now $1.02.
Importance: A valuable security may need some time to rebound from its undervalued position. The risk of investing in a value stock is that this emergence never materializes.