A Look Into Financial Services Sector Value Stocks
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 financial services sector that may be worth watching:
- OptimumBank Hldgs (NASDAQ:OPHC) - P/E: 2.58
- Itau Corpbanca (NYSE:ITCB) - P/E: 4.27
- HBT Finl (NASDAQ:HBT) - P/E: 9.74
- Flagstar Bancorp (NYSE:FBC) - P/E: 5.14
- Deutsche Bank (NYSE:DB) - P/E: 8.24
Most recently, OptimumBank Hldgs reported earnings per share at $0.16, whereas in Q1 earnings per share sat at $0.17. Itau Corpbanca saw an increase in earnings per share from 0.22 in Q1 to $0.25 now. The company's most recent dividend yield sits at 5.56%, which has increased by 4.8% from 0.76% last quarter.
HBT Finl's earnings per share for Q3 sits at $0.55, whereas in Q2, they were at 0.48. Its most recent dividend yield is at 3.68%, which has increased by 0.14% from 3.54% in the previous quarter.
Flagstar Bancorp's earnings per share for Q3 sits at $1.41, whereas in Q2, they were at 1.17. Most recently, the company reported a dividend yield of 0.73%, which has increased by 0.08% from last quarter's yield of 0.65%.
This quarter, Deutsche Bank experienced an increase in earnings per share, which was $0.35 in Q2 and is now $0.57.
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.