Value Stocks

What are value stocks?

One of the sweetest and most profitable pleasures of successful investing is to buy high-quality “value stocks” (or stocks that are reasonably priced, if not cheap, in relation to its sales, earnings or assets), then hold on to them as mainstream investors recognize the value and push up the share price.

Value stocks are stocks trading lower than their financial fundamentals suggest. They are perceived as undervalued, and have the potential to rise. Many new tech stocks, for instance, start out as growth stocks and transition into value stocks.

They have a low price-to-earnings and price-to-book ratios—which is why they’re less expensive than growth stocks. Due to this fundamental distinction, a value stock is often traded at a more affordable rate than a growth stock.

To investors, they see companies that fall into this category as undervalued. These investors are less likely to invest in a growth stock because they feel that value company’s stock will eventually reach their full potential once they are recognized by the market.

Generally speaking, the climb is steady for value stocks. The only other way for it to emerge into the market like a growth stock is for it to be a bit more innovative with its products or services.

Pat McKeough is an expert at delving into a company’s financial statements and identifying undervalued securities and value stocks. That’s because value stocks are the foundation of any long term investment strategy, at TSI Network we also recommend our three-part Successful Investor strategy:

  1. Invest mainly in well-established companies;
  2. Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; the Consumer sector; Finance; Utilities);
  3. Downplay or avoid stocks in the broker/media limelight.

Quality Stocks, Bargain Prices: read this FREE Special Report, Canadian Value Stocks: How to Spot Undervalued Stocks & Our Top 4 Value Stock Pick.

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Value Stocks Post Archives

Is Value Investing Still Relevant? Absolutely, If Done Correctly

Is value investing still relevant? Value investing has been used by many investors, in conjunction with other investment considerations, to profit over long periods
Is value investing still relevant? Yes—and here are some tips on how to do it successfully:

Value stocks are generally good bargains,… Read More

Get 5.9% yield from Choice Properties REIT

Get 5.9% yield from Choice Properties REIT

The market plunge in the wake of COVID-19 hurt many stock and REIT prices, but this particular REIT is increasingly focused on high-value core markets.  

That reduces risk, spurs increased gains and distributions, and strengthens its appeal for income seekers. 

CHOICE PROPERTIES REIT, (Toronto symbol CHP.UN;… Read More

Get a 5.2% yield from IBM

Get a 5.2% yield from IBM

Weaker demand for legacy operations contributed to a 3.4% drop in revenue in the most-recent quarter. 

However, a recent acquisition supports the company’s shift to cloud computing and the sales and earnings growth associated with it. 

IBM (New York symbol IBM; www.ibm.com) gives investors exposure to one… Read More

3 key ways to cut your risk in value stock investing

3 key ways to cut your risk in value stock investing

Value stock investing pointers: look at goodwill and investment quality, and look beyond financial indicators
When you begin investing, you may think the secret to investment profit is “buy low, sell high.” But that’s hard to do. You’ll often buy just before prices fall, or sell… Read More

Get a 5.2% yield from IBM

Get a 5.2% yield from IBM

Weaker demand for legacy operations contributed to a 3.4% drop in revenue in the most-recent quarter. 

However, a recent acquisition supports the company’s pivot to cloud computing and stronger sales and earnings. 

IBM (New York symbol IBM; www.ibm.com) gives investors exposure to one of the world’s largest… Read More

Long-term value investing tips—and traps to avoid

Long-term value investing tips—and traps to avoid

Long-term value investing is a key part of building a balanced and diversified portfolio
The core of the long-term value investing approach is identifying well-financed companies that are established in their businesses and have a history of earnings and dividends. They are likely to survive any… Read More

Extendicare Inc. maintains revenue and occupancy strength

Extendicare Inc. maintains revenue and occupancy strength

This firm’s revenues rose 2.3% during the most-recent quarter, even as COVID-19 raised investor worries about the outlook for it and other long-term-care providers.

The company’s cash flow did dip 7.9% on higher maintenance spending, but occupancy levels remain strong.

EXTENDICARE INC. (Toronto symbol EXE; www.extendicare.com) owns… Read More

Dividend Investing vs. Value Investing

Dividend Investing vs. Value Investing

In choosing dividend investing vs value investing, it’s important to recognize that both can lead to favourable returns
To decide between dividend investing vs value investing, investors must first distinguish between the two. The best dividend stocks respond to tough economic times by doing their best to maintain,… Read More

Get a 4.0% yield from Honda Motor Co. Ltd.

Get a 4.0% yield from Honda Motor Co. Ltd.

American Depositary Receipts (ADRs) make it easier for Canadian and other Western investors to benefit from the value of the best overseas companies.

While car sales will likely remain depressed for the next few months, this world-class firm should outpace many competitors thanks to effective… Read More