Overview Of Value Stocks 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. Boise Cascade BCC - P/E: 7.51
2. CF Industries Holdings CF - P/E: 6.34
3. Warrior Met Coal HCC - P/E: 4.44
4. Olin OLN - P/E: 9.69
5. Koppers Hldgs KOP - P/E: 9.77

Boise Cascade saw an increase in earnings per share from 2.43 in Q1 to $3.67 now. Its most recent dividend yield is at 0.81%, which has decreased by 0.07% from 0.88% in the previous quarter.

CF Industries Holdings has reported Q2 earnings per share at $2.7, which has decreased by 5.26% compared to Q1, which was 2.85. The company's most recent dividend yield sits at 2.28%, which has increased by 0.12% from 2.16% last quarter.

Warrior Met Coal saw a decrease in earnings per share from 3.57 in Q1 to $1.63 now. Most recently, the company reported a dividend yield of 0.66%, which has decreased by 0.1% from last quarter's yield of 0.76%.

This quarter, Olin experienced a decrease in earnings per share, which was $1.16 in Q1 and is now $1.13. Most recently, the company reported a dividend yield of 1.44%, which has decreased by 0.07% from last quarter's yield of 1.51%.

Most recently, Koppers Hldgs reported earnings per share at $1.26, whereas in Q1 earnings per share sat at $1.12. Its most recent dividend yield is at 0.62%, which has decreased by 0.13% from 0.75% in the previous 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.