A Look Into Real Estate Sector Value Stocks

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 real estate sector that may be worth watching:

1. Ellington Financial EFC - P/E: 4.78
2. GEO Group GEO - P/E: 7.35
3. PotlatchDeltic PCH - P/E: 8.44
4. Dynex Cap DX - P/E: 3.96
5. Ready Capital RC - P/E: 7.84

Most recently, Ellington Financial reported earnings per share at 0.46, whereas in Q2 earnings per share sat at 0.51. Most recently, the company reported a dividend yield of 10.46%, which has increased by 0.6% from last quarter's yield of 9.86%.

Most recently, GEO Group reported earnings per share at 0.52, whereas in Q2 earnings per share sat at 0.58. Its most recent dividend yield is at 11.16%, which has decreased by 0.86% from 12.02% in the previous quarter.

Most recently, PotlatchDeltic reported earnings per share at 0.92, whereas in Q2 earnings per share sat at 2.77. Most recently, Dynex Cap reported earnings per share at 0.54, whereas in Q2 earnings per share sat at 0.51. Most recently, the company reported a dividend yield of 9.06%, which has increased by 0.33% from last quarter's yield of 8.73%.

This quarter, Ready Capital experienced an increase in earnings per share, which was 0.52 in Q2 and is now 0.64. Its most recent dividend yield is at 10.55%, which has decreased by 0.67% from 11.22% in the previous 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.