5 Value Stocks To Watch In The Consumer Cyclical 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.

Below is a list of notable value stocks in the consumer cyclical sector:

1. MasterCraft Boat Hldgs MCFT - P/E: 7.38
2. BRP DOOO - P/E: 9.76
3. Shoe Carnival SCVL - P/E: 6.33
4. Beazer Homes USA BZH - P/E: 2.45
5. Toll Brothers TOL - P/E: 5.32

MasterCraft Boat Hldgs's earnings per share for Q2 sits at $1.2, whereas in Q1, they were at 1.43. Most recently, BRP reported earnings per share at $2.86, whereas in Q3 earnings per share sat at $2.74. Its most recent dividend yield is at 0.66%, which has decreased by 0.02% from 0.68% in the previous quarter.

Shoe Carnival has reported Q4 earnings per share at $0.79, which has decreased by 33.05% compared to Q3, which was 1.18. The company's most recent dividend yield sits at 1.71%, which has increased by 0.21% from 1.5% last quarter.

This quarter, Beazer Homes USA experienced a decrease in earnings per share, which was $2.82 in Q4 and is now $0.8. Toll Brothers saw a decrease in earnings per share from 4.7 in Q4 to $1.7 now. The company's most recent dividend yield sits at 1.41%, which has decreased by 0.17% from 1.58% last 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.