Overview Of Value Stocks In The Basic Materials Sector

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 basic materials sector that may be worth watching:

1. Valhi VHI - P/E: 7.53
2. Hycroft Mining Holding HYMC - P/E: 0.62
3. Sylvamo SLVM - P/E: 5.23
4. Braskem BAK - P/E: 2.94
5. Ero Copper ERO - P/E: 6.11

Valhi saw an increase in earnings per share from 0.75 in Q2 to $1.36 now. The company's most recent dividend yield sits at 1.38%, which has decreased by 0.13% from 1.51% last quarter.

This quarter, Hycroft Mining Holding experienced a decrease in earnings per share, which was $-0.14 in Q2 and is now $-0.39. Most recently, Sylvamo reported earnings per share at $1.71, whereas in Q3 earnings per share sat at $2.27. Braskem has reported Q3 earnings per share at $1.7, which has decreased by 51.7% compared to Q2, which was 3.52. Most recently, the company reported a dividend yield of 7.77%, which has increased by 2.39% from last quarter's yield of 5.38%.

Ero Copper saw a decrease in earnings per share from 0.58 in Q2 to $0.49 now.

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.