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

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American Express adds 10 million new accounts

Payment-card issuer saw its revenue and earnings slip in the latest quarter, but added millions of new accounts in 2016.
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Long-Term Stocks to Buy: Here’s how to find them

Long-Term Stocks to Buy: Here’s how to find them

There are a variety of factors to consider when you look for long-term stocks to buy, including whether they pay dividends, their position in their industry and management strength
One successful strategy for finding long-term stocks to buy is to identify well-financed companies that are well-established… Read More

Stocks That Are Going Up Can Be Riskier Than They Appear

Stocks That Are Going Up Can Be Riskier Than They Appear

Momentum stocks that are going up may look like winning investments, but they can simply be gambles in disguise
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A Pat McKeough Q&A on Value Stocks

A Pat McKeough Q&A on Value Stocks

What are value stocks truly worth? The answer depends on a number of factors, including hidden assets and profit potential
What are value stocks? The best value stocks are low in price and high in potential.

One of the sweetest and most profitable pleasures of successful investing… Read More