What Defines a Value Stock?

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.

Below is a list of notable value stocks in the real estate sector:

1. Ladder Cap LADR - P/E: 8.1
2. AFC Gamma AFCG - P/E: 6.49
3. Transcontinental Realty TCI - P/E: 0.7
4. Seven Hills Realty Trust SEVN - P/E: 5.48
5. Chicago Atlantic Real REFI - P/E: 7.27

This quarter, Ladder Cap experienced an increase in earnings per share, which was $0.31 in Q4 and is now $0.38. Its most recent dividend yield is at 9.55%, which has increased by 0.76% from 8.79% in the previous quarter.

This quarter, AFC Gamma experienced a decrease in earnings per share, which was $0.62 in Q4 and is now $0.57. Its most recent dividend yield is at 14.37%, which has increased by 0.69% from 13.68% in the previous quarter.

Transcontinental Realty's earnings per share for Q1 sits at $0.41, whereas in Q4, they were at 6.82. Most recently, Seven Hills Realty Trust reported earnings per share at $0.39, whereas in Q4 earnings per share sat at $0.37. The company's most recent dividend yield sits at 14.03%, which has decreased by 1.29% from 15.32% last quarter.

Most recently, Chicago Atlantic Real reported earnings per share at $0.62, whereas in Q4 earnings per share sat at $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.