What Is a Mid-Cap Value Stock?

A mid-cap value stock has been identified by industry analysts as a good choice for value investors at its current price per share. Mid-cap indicates that it is a mode🎃rate-sized company in terms of its total market capitalization.

How Mid-Cap Value Stocks Work

Given the vast number of stocks, investors use a variety of methods to categorize and make sense of the opportunities availa🙈ble to them.

One of the most common categories used by investors is company size. Another is the investment strategy tꦉhat they seem bes🍸t suited to address.

Market Capitalization

Companies are typically categorized by their total market cap♛italization. This is simply its current share price multiplied by the number of outstanding shares of the stock.

They can then be categorized as 澳洲幸运5开奖号码历史查询:large-cap, mid-cap, or 澳洲幸运5开奖号码历史查询:small-cap stocks. Some investors using additional terms such as mega-cap and 澳洲幸运5开奖号码历史查询:micro-cap to refer to especialܫly large and small companies.

Investment Style

The issu🐼e of investment style is more relevant to the strategy of the potential investor than to the stock. Investors generally distinguish between the strategies of value investing and growth investing. 

Value investors aim to buy shares of stocks that are selling at less than their 澳洲幸运5开奖号码历史查询:intrinsic value—that is, for less than they are worth.  Of course, individual investors differ in their assessments of intrinsic value as well as in their meth𒆙odsꦆ for arriving at this conclusion.

Common examples of valuation methods used by value investors include 澳洲幸运5开奖号码历史查询:financial ratios such as the 澳洲幸运5开奖号码历史查询:price-to-earnings (P/E) and 澳洲幸运5开奖号码历史查询:price-to-book-value (P/B) ratios; 澳洲幸运5开奖号码历史查询:discounted cash-flow analysis (DCF), and q🌠ualitative assessmentsꩵ of a company’s competitive advantages.

Growth investors, meanwhile, are more concerned with the future prospects of a company as well as its current momentum in market trading. Companies that are perceived to have growth prospects might benefit from favorable tailwinds, as investor enthusiasm encourages a growing pool of investors to bid up the share price. In some🤪 cases, special circumstances such as an upcoming product launch or an unexpected earnings beat could feed enthusiasm among growth investors.

Combining Mid-Cap and Value

With this in mind, a mid-cap value s🀅tock is a stock that is appealing to🔴 value investors and is of middling size based on its market capitalization.

As a general rule, larger companies will tend to have greater coverage by analysts and the media. All thღat attention means they may be less likely to have a big difference between market price and intrinsic value.

For this reason, ma෴ny value investors believe that the best investment opportunities are generally found among small and mid-cap valღue stocks.

Example of a Mid-Cap Value Stock

Investors who want to gain exposure to mid-cap value stocks have several methods at their disposal. Those who are willing and able to conduct their own research can search for companies manually using tools such as 澳洲幸运5开奖号码历史查询:stock screeners. 澳洲幸运5开奖号码历史查询:Passive investors can also rely on third-party indexes, mutual funds, and exchange-traded funds (ETFs) which will allow them to invest in a diversified portfoli🔯o of mid-cap value stocks using a single investment vehicle.

One popular example of a mid-cap value stock investment is the Mid-Cap Value Index Fund Admiral Shares offered by Vanguard. Trading under the ticker symbol VMVAX, its ten largest holdings as of Q1 2021 included:

1. Occidental Petroleum Corp.
2. Valero Energy Corp.
3. Nucor Corp.
4. Corteva Inc.
5. Welltower Inc.
6. Dollar Tree Inc.
7. Motorola Solutions Inc.
8. Kroger Co.
9. Arthur J. Gallagher & Co.
10. Consolidated Edison Inc.