Value stocks are defined as stocks with ____________.

Question

Quizplus · Accepted Answer

Value stocks are typically characterized by low P/E (price-to-earnings) ratios, indicating that the price of the stock is low relative to the company’s earnings. This means that investors can potentially purchase the stock at a discount and benefit from future growth in the company’s earnings. While some value stocks may also have low prices or M/B (market-to-book) ratios, the defining characteristic is generally the low P/E ratio. High growth rates and high dividends are not necessarily indicative of value stocks.

Value Stocks Are Defined as Stocks with ____________