What are 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 consumer defensive sector that may be worth watching:

1. Cal-Maine Foods (NASDAQ:CALM) - P/E: 3.03
2. Bunge (NYSE:BG) - P/E: 8.94
3. Bridgford Foods (NASDAQ:BRID) - P/E: 2.4
4. Amcon Distributing (AMEX:DIT) - P/E: 7.77
5. iHuman (NYSE:IH) - P/E: 9.02

Most recently, Cal-Maine Foods reported earnings per share at $6.62, whereas in Q2 earnings per share sat at $4.07. Its most recent dividend yield is at 15.92%, which has increased by 7.45% from 8.47% in the previous quarter.

Most recently, Bunge reported earnings per share at $3.26, whereas in Q4 earnings per share sat at $3.24. The company's most recent dividend yield sits at 2.96%, which has increased by 0.36% from 2.6% last quarter.

Bridgford Foods's earnings per share for Q1 sits at $0.1, whereas in Q4, they were at 0.29. Amcon Distributing's earnings per share for Q2 sits at $3.49, whereas in Q1, they were at 4.46. The company's most recent dividend yield sits at 0.39%, which has decreased by 0.04% from 0.43% last quarter.

iHuman has been featured as a value stock. iHuman's Q4 EPS sits at $0.11, which has not changed since last quarter (Q3).

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.