5 Value Stocks To Watch In The Basic Materials Sector

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.

The following stocks are considered to be notable value stocks in the basic materials sector:

1. SunCoke Energy SXC - P/E: 8.08
2. Sisecam Resources SIRE - P/E: 8.05
3. Ternium TX - P/E: 4.84
4. Caledonia Mining CMCL - P/E: 5.61
5. Warrior Met Coal HCC - P/E: 3.13

SunCoke Energy saw a decrease in earnings per share from 0.49 in Q3 to $0.14 now. The company's most recent dividend yield sits at 3.54%, which has decreased by 1.15% from 4.69% last quarter.

Most recently, Sisecam Resources reported earnings per share at $0.83, whereas in Q3 earnings per share sat at $0.76. Most recently, the company reported a dividend yield of 8.23%, which has decreased by 0.67% from last quarter's yield of 8.9%.

Most recently, Ternium reported earnings per share at $0.2, whereas in Q3 earnings per share sat at $0.78. Its most recent dividend yield is at 4.75%, which has decreased by 1.76% from 6.51% in the previous quarter.

Caledonia Mining saw an increase in earnings per share from 0.56 in Q2 to $0.61 now. Its most recent dividend yield is at 4.42%, which has decreased by 1.28% from 5.7% in the previous quarter.

This quarter, Warrior Met Coal experienced a decrease in earnings per share, which was $2.1 in Q3 and is now $1.9.

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.