Understanding Value Stocks
A value stock traditionally has a lower price when compared to stock prices of companies in the same industry. This indicates that the company may be undervalued, as investors are not expressing as much interest in such companies. The most commonly used way to check for value is with the price-to-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 communication services sector that may be worth watching:
- Liberty Broadband (NASDAQ:LBRDA) - P/E: 9.88
- Zedge (AMEX:ZDGE) - P/E: 4.13
- Hello Gr (NASDAQ:MOMO) - P/E: 7.86
- E W Scripps (NASDAQ:SSP) - P/E: 5.44
- Liberty SiriusXM Gr (NASDAQ:LSXMK) - P/E: 7.04
Liberty Broadband saw a decrease in earnings per share from 2.05 in Q3 to $1.26 now. Zedge saw an increase in earnings per share from -0.01 in Q1 to $0.11 now. Hello Gr has reported Q4 earnings per share at $0.36, which has decreased by 2.7% compared to Q3, which was 0.37. Most recently, E W Scripps reported earnings per share at $0.84, whereas in Q3 earnings per share sat at $0.38. Most recently, the company reported a dividend yield of 2.01%, which has increased by 0.33% from last quarter's yield of 1.68%.
Liberty SiriusXM Gr's earnings per share for Q4 sits at $1.54, whereas in Q3, they were at 0.06.
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.