Zacks Value Investor Highlights: Vanguard Small Cap Value ETF, Vanguard Small-Cap Growth ETF, CAI International, Energy Recovery And Rocky Brands
Zacks Investment Research | Apr 27, 2017 09:30PM ET
For Immediate Release
Chicago, IL – April 28, 2017 – Zacks Value Investor is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here: ( https://www.zacks.com/stock/news/258047/3-small-cap-value-stocks-to-keep-on-your-radar )
3 Small-Cap Value Stocks to Keep on Your Radar
Welcome to Episode #39 of the Value Investor Podcast
Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio service , shares some of her top value investing tips and stock picks.
Historically, small cap value has outperformed small cap growth stocks. Over the last several years, however, that was the reverse, until the November 2016 election, when small cap value stocks soared.
But in 2017, small cap value is back to being relegated to the back of the pack. The Vanguard Small Cap Value ETF (NYSEARCA: Free Report ) which is up 7.5%. It’s even underperforming the larger small cap index, the Russell 2000, which is up 4%.
That means there is a buying opportunity for investors willing to take a deeper dive into the small cap value names.
Screening for Small Caps Isn’t Easy
Tracey ran a screen looking for only the best of the small cap value stocks. But it turns out, there aren’t that many high-quality names out there that also have Zacks Ranks of #1 (Strong Buy) and #2 (Buy).
Investors should be careful with small caps. Many have market caps that are so low it makes investing in those stocks difficult.
Additionally, they tend to be more volatile so you should know your risk tolerance.
3 Small Cap Value Stocks to Keep on Your Radar
1. CAI International (NYSE: Free Report ) is a transportation and logistics company with a market cap of $400 million. In its Q1 earnings, it said it saw a “strong and improving” market environment. It has a forward P/E of 13.2.
2. Energy Recovery (NASDAQ: Free Report ) provides energy recovery solutions to the oil & gas, chemical and water industries. It’s due to report earnings on May 3. It has a market cap of $454 million and a forward P/E of 11.8.
3. Rocky Brands (NASDAQ: Free Report ) was founded in 1932 and is headquartered in Ohio. It makes premium Outdoor, Western, Duty, Work and Military footwear. In its Q1 earnings report, it said trends in stores have stabilized in 2017, especially in Work and Western. It has a market cap of just $100 million and a forward P/E of 14.8.
All three of these aren’t just value stocks. As an added bonus, they also have strong growth stories, with double and triple digit earnings growth expected this year.
What else should value investors know about small cap value stocks?
Tune into this week’s podcast to find out.
[In full disclosure, Tracey owns shares of VBR in her personal portfolio.]
Want more value investing insights from Tracey?
Check out her weekly Value Investor service to receive more in-depth analysis on value companies and see which stocks Tracey thinks are the best bargains now.
It holds between 20 and 25 value stocks for the long haul.
Click here to learn more.
Tracey Ryniec is the Value Stock Strategist for Zacks.com. She is also the Editor of the Zacks Market Edge Podcast on iTunes.
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