Overview Of Value Stocks In The Consumer Cyclical Sector

What is a Value Stock?

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 consumer cyclical sector:

1. Beazer Homes USA BZH - P/E: 1.88
2. Smart Share Glb EM - P/E: 0.95
3. Citi Trends CTRN - P/E: 4.02
4. O-I Glass OI - P/E: 4.27
5. Allison Transmission ALSN - P/E: 8.24

Most recently, Beazer Homes USA reported earnings per share at $2.82, whereas in Q3 earnings per share sat at $1.76. Most recently, Smart Share Glb reported earnings per share at $-0.1, whereas in Q1 earnings per share sat at $-0.05. Most recently, Citi Trends reported earnings per share at $0.24, whereas in Q2 earnings per share sat at $-0.31. Its most recent dividend yield is at 1.35%, which has decreased by 0.27% from 1.62% in the previous quarter.

O-I Glass has reported Q3 earnings per share at $0.63, which has decreased by 13.7% compared to Q2, which was 0.73. The company's most recent dividend yield sits at 1.54%, which has decreased by 0.33% from 1.87% last quarter.

Allison Transmission saw an increase in earnings per share from 1.26 in Q2 to $1.45 now. Its most recent dividend yield is at 1.96%, which has decreased by 0.27% from 2.23% 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.