5 Value Stocks In The Basic Materials Sector

What are Value Stocks?

A value stock is traditionally defined in terms of how investors in the marketplace are valuing that company's future growth prospects. Low P/E multiples are good base indicators that the company is undervalued and can most likely be labelled as a value stock.

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

1. Nutrien NTR - P/E: 4.65
2. LSB Industries LXU - P/E: 4.57
3. FutureFuel FF - P/E: 7.89
4. Warrior Met Coal HCC - P/E: 2.76
5. Reliance Steel & Aluminum RS - P/E: 9.13

Nutrien has reported Q1 earnings per share at $1.11, which has decreased by 45.05% compared to Q4, which was 2.02. The company's most recent dividend yield sits at 3.32%, which has increased by 0.57% from 2.75% last quarter.

LSB Industries saw a decrease in earnings per share from 0.9 in Q4 to $0.25 now. This quarter, FutureFuel experienced an increase in earnings per share, which was $0.34 in Q4 and is now $0.48. Its most recent dividend yield is at 2.78%, which has ('', 'not changed') by 0.0% from 2.78% in the previous quarter.

This quarter, Warrior Met Coal experienced an increase in earnings per share, which was $1.9 in Q4 and is now $3.57. Most recently, Reliance Steel & Aluminum reported earnings per share at $6.37, whereas in Q4 earnings per share sat at $5.87. The company's most recent dividend yield sits at 1.6%, which has decreased by 0.13% from 1.73% 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.