5 Value Stocks In The Financial Services 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.

The following stocks are considered to be notable value stocks in the financial services sector:

1. Heritage Financial HFWA - P/E: 9.48
2. Cathay General CATY - P/E: 7.26
3. Timberland Bancorp TSBK - P/E: 8.92
4. Itau Corpbanca ITCB - P/E: 4.27
5. Velocity Financial VEL - P/E: 9.57

Heritage Financial saw an increase in earnings per share from 0.59 in Q3 to $0.64 now. Most recently, the company reported a dividend yield of 3.1%, which has increased by 0.34% from last quarter's yield of 2.76%.

Most recently, Cathay General reported earnings per share at $1.33, whereas in Q3 earnings per share sat at $1.35. The company's most recent dividend yield sits at 3.05%, which has increased by 0.05% from 3.0% last quarter.

Timberland Bancorp's earnings per share for Q1 sits at $0.9, whereas in Q4, they were at 0.85. Most recently, the company reported a dividend yield of 2.76%, which has decreased by 0.24% from last quarter's yield of 3.0%.

Most recently, Itau Corpbanca reported earnings per share at $0.15, whereas in Q3 earnings per share sat at $0.19. The company's most recent dividend yield sits at 5.56%, which has increased by 4.8% from 0.76% last quarter.

Most recently, Velocity Financial reported earnings per share at $0.27, whereas in Q3 earnings per share sat at $0.29.

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.