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 communication services sector:
- Liberty Global (NASDAQ:LBTYA) - P/E: 0.97
- Grupo Televisa (NYSE:TV) - P/E: 0.02
- Paramount Global (NASDAQ:PARA) - P/E: 4.35
- Sohu.com (NASDAQ:SOHU) - P/E: 8.85
- Turkcell Iletisim (NYSE:TKC) - P/E: 8.99
Liberty Global saw an increase in earnings per share from 0.48 in Q3 to $1.26 now. Grupo Televisa saw a decrease in earnings per share from 0.26 in Q4 to $-0.18 now. Most recently, the company reported a dividend yield of 0.78%, which has increased by 0.28% from last quarter's yield of 0.5%.
Paramount Global saw a decrease in earnings per share from 0.76 in Q3 to $0.26 now. Its most recent dividend yield is at 2.55%, which has decreased by 0.13% from 2.68% in the previous quarter.
Sohu.com's earnings per share for Q4 sits at $0.01, whereas in Q3, they were at 0.44. This quarter, Turkcell Iletisim experienced a decrease in earnings per share, which was $0.06 in Q4 and is now $0.03. Most recently, the company reported a dividend yield of 4.81%, which has increased by 2.34% from last quarter's yield of 2.47%.
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.
