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The Meaning Behind 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 utilities sector:

  1. OPAL Fuels OPAL – P/E: 4.1
  2. Clearway Energy CWEN – P/E: 7.03
  3. Suburban Propane Partners SPH – P/E: 7.42
  4. OGE Energy OGE – P/E: 8.61
  5. NRG Energy NRG – P/E: 4.18

OPAL Fuels’s earnings per share for Q3 sits at $-0.06, whereas in Q2, they were at 0.08. Most recently, Clearway Energy reported earnings per share at $0.28, whereas in Q2 earnings per share sat at $-4.37. Its most recent dividend yield is at 4.19%, which has increased by 0.35% from 3.84% in the previous quarter.

Suburban Propane Partners saw a decrease in earnings per share from -0.04 in Q3 to $-0.86 now. Its most recent dividend yield is at 7.97%, which has decreased by 0.21% from 8.18% in the previous quarter.

OGE Energy’s earnings per share for Q3 sits at $1.31, whereas in Q2, they were at 0.36. Its most recent dividend yield is at 4.19%, which has decreased by 0.06% from 4.25% in the previous quarter.

Most recently, NRG Energy reported earnings per share at $0.29, whereas in Q2 earnings per share sat at $2.16. Most recently, the company reported a dividend yield of 3.44%, which has decreased by 0.48% from last quarter’s yield of 3.92%.

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.


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