5 Value Stocks In The Financial Services Sector

Understanding 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 financial services sector:

1. Bank7 BSVN - P/E: 8.52
2. HV Bancorp HVBC - P/E: 6.61
3. Sixth Street Specialty TSLX - P/E: 8.43
4. Mercury General MCY - P/E: 9.65
5. Portman Ridge Finance PTMN - P/E: 3.76

Bank7 saw an increase in earnings per share from 0.48 in Q3 to 0.52 now. Most recently, the company reported a dividend yield of 2.36%, which has decreased by 1.34% from last quarter's yield of 3.7%.

HV Bancorp looks to be undervalued. It possesses an EPS of 1.02, which has not changed since last quarter (Q3). HV Bancorp does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Most recently, Sixth Street Specialty reported earnings per share at 0.5, whereas in Q3 earnings per share sat at 0.61. Sixth Street Specialty does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.

Most recently, Mercury General reported earnings per share at 1.38, whereas in Q3 earnings per share sat at 1.23. The company's most recent dividend yield sits at 4.52%, which has decreased by 1.62% from 6.14% last quarter.

Most recently, Portman Ridge Finance reported earnings per share at 0.08, whereas in Q3 earnings per share sat at 0.06. Most recently, the company reported a dividend yield of 11.43%, which has decreased by 6.09% from last quarter's yield of 17.52%.

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.