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:
 The Profits from Hidden ValueLearn everything you need to know in 7 Pro Secrets to Value Investing for a FREE special report for you. Canadian Value Stocks: |
Canadian Tire has offered our investors so much more than hammers and nails. The stock’s up over 1,066.0% since we first recommended it in The Successful Investor in April 1995.
A $3.4 billion long-term growth plan that includes store, online business and private-label brand upgrades… Read More
While assets under management have declined with the recent market downturn, a recent acquisition will help lift IGM Financial’s business in China and add to earnings immediately.
We expect stock market volatility and higher interest rates to create more demand for the firm’s professional advisors.
The stock… Read More
E-commerce helped lead the way to a 3.9% revenue and 6.4% earnings gain for this top pick during the most-recent quarter.
A $3.4 billion long-term growth plan that includes store, online business and private-label brand upgrades should help sustain this momentum and provide a basis for… Read More
Two recent acquisitions continue to focus the firm on consumer tools and equipment as it divests from commercial security, automatic doors, and oil and gas equipment services.
A cost-cutting program should restore earnings growth in 2024 despite an expected drop in 2023. Meanwhile the stock trades… Read More
This firm recently announced that its CEO will step down to head up the Bank of Nova Scotia. The company has appointed Kevin Parkes as his replacement.
Mr. Parkes will likely continue the company’s current strategy of expanding its product support (equipment maintenance) business. The company’s… Read More
This leading foodmaker continues to post strong sales gains, mainly because it’s increasing its selling prices as it copes with higher costs for ingredients, labour and fuel.
Thanks to its strong brands, higher prices have not significantly hurt its volumes. The company is also improving its… Read More
Improved sales led to a 15.2% jump in revenue for this company during the most-recent quarter.
A new strategic plan has delivered a company focused on canned soups, pasta and V8 vegetable juices which plays to its strengths. We think the firm will continue to find… Read More
COVID-19 lockdowns prompted many Canadians to upgrade their homes with furniture purchased though this firm’s online channels. Now that its stores have fully re-opened, the company is building a new distribution facility in Edmonton to support the growth of the business—and your dividend too.
Meanwhile, the… Read More
Momentum stocks that are going up may look like winning investments, but they can simply be gambles in disguise
Successful investors try to arrange their portfolios so that they more-or-less automatically tap into the profit and long-term growth that inevitably comes to well-established companies operating… Read More
Thanks to escalating costs, this firm’s earnings are falling significantly despite reopening bars and restaurants . We don’t think the increased dividend is enough to offset those risks.
Meanwhile the shares trade at 13.2 times forecast earnings.
MOLSON COORS CANADA INC. (Toronto symbols TPX.A and TPX.B; www.molsoncoors.com)… Read More
When looking to spot undervalued stocks, look at factors like hidden assets, financial ratios, and growth prospects. Read on to find out more about this process
Undervalued stocks are companies that have strong fundamentals and are trading, for one reason or another, at a low share… Read More
This firm’s share price is unchanged since the start of 2022, mainly because rising interest rates have prompted income-seeking investors to buy bonds instead. Higher rates are also making it more expensive for the firm to build out its new ultrafast 5G wireless networks.
However, we… Read More
As a seller of mutual funds and wealth management services, this firm’s fee income rises and falls with the value of the securities it manages.
Due to the drop in stock values, the shares are down 19% since the start of 2022. However, the current… Read More
Improved sales of automotive parts and services as well as household and sporting goods led to a 12.4% revenue jump for this company during the most-recent quarter.
Higher loan-loss provisions and operating costs hurt earnings but the company plans to close unprofitable stores and cut expenses.
The… Read More
While supply-chain disruptions and rising costs for labour and shipping add risk, this firm continues to reward investors with higher dividends and share buybacks.
Recent acquisitions and divestments have focused the firm on its consumer tool business.
Meanwhile the stock trades at 14.9 times the company’s 2022… Read More
In the past few years, securely connecting to the Internet has become crucial as more businesses sell goods and transfer sensitive information online. Part of that is more non-computer devices—like cars and household appliances—are also connecting to the “Internet of Things.”
As the market leader in… Read More
Sales improved 17.5% and generated a huge 42.9% earnings rise as demand for equipment and maintenance services continued to build.
Earnings should show strong growth across all of 2022, which further enhances the appeal of an 8.4 p/e.
FINNING INTERNATIONAL INC. (Toronto symbol FTT; www.finning.com) sells and… Read More
Rising snack-foods sales also led to a 7.4% jump in revenue for this company during the most-recent quarter.
A recent $6.1 billion acquisition has accelerated the company’s focus on its core areas.
Meanwhile the stock trades at 17.0 times the company’s 2022 earnings forecast.
The Profits from Hidden ValueLearn everything you need to know in 7 Pro Secrets to Value Investing for a FREE special report for you. Canadian Value Stocks: How to Spot Undervalued Stocks PLUS! Our Top 4 Value Stocks |
CAMPBELL SOUP CO. (New… Read More
Understanding what fundamentals to look for in a stock will help you decide if it’s a sound investment for your diversified portfolio or not.
Company fundamentals are essentially a firm’s financial numbers. Do you know what fundamentals to look for in a stock? These include the… Read More
Using our Canadian value investing strategy will help you find stocks that are reasonably priced compared to sales, earnings or assets. Learn this strategy now.
Canadian value stocks are generally good bargains, but not all bargain stocks offer good value. The search for value stocks that… Read More
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Canadian Value Stocks:
How to Spot Undervalued Stocks
PLUS! Our Top 4 Value Stocks
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