5 Value Stocks To Watch In The Energy Sector

The Meaning Behind 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.

Benzinga Insights has compiled a list of value stocks in the energy sector that may be worth watching:

1. Murphy Oil MUR - P/E: 6.85
2. SilverBow Resources SBOW - P/E: 1.65
3. National Fuel Gas NFG - P/E: 8.75
4. Diamondback Energy FANG - P/E: 7.93
5. Equinor EQNR - P/E: 4.29

This quarter, Murphy Oil experienced a decrease in earnings per share, which was $1.24 in Q1 and is now $0.79. The company's most recent dividend yield sits at 2.56%, which has decreased by 0.28% from 2.84% last quarter.

SilverBow Resources has reported Q2 earnings per share at $1.1, which has decreased by 73.62% compared to Q1, which was 4.17. National Fuel Gas's earnings per share for Q3 sits at $1.01, whereas in Q2, they were at 1.54. The company's most recent dividend yield sits at 3.75%, which has decreased by 0.13% from 3.88% last quarter.

Diamondback Energy saw a decrease in earnings per share from 4.1 in Q1 to $3.68 now. Most recently, the company reported a dividend yield of 2.31%, which has increased by 0.06% from last quarter's yield of 2.25%.

Equinor's earnings per share for Q2 sits at $0.73, whereas in Q1, they were at 1.12. Its most recent dividend yield is at 4.45%, which has increased by 0.35% from 4.1% 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.