Hunting for cut-price stocks that could benefit from a value revival

Is value investing making a long-awaited comeback? There have been signs this autumn that after nearly a decade in the doldrums, one of the most tried and trusted stock market strategies is starting to work again. Value investing – the part-art, part-science approach to buying shares when they’re marked down – has flickered into life on both sides of the Atlantic. For weary value investors, the headlines are a welcome relief. But after an unusually long spell of underperformance, it’ll likely take more concrete proof to convince many that the market really is turning a corner. While everyone knows that value strategies suffer lapses in performance, a 10-year hiatus has been a tough test for even the most devout followers of Ben Graham (the father of value investing). In that time, the expansionary effects of cheap money and central bank stimulus has washed through the economy and spilled across the stock market. Confidence has surged and growth stocks have benefited most. Meanwhile, those beaten, broken, unloved and unsupported value stocks have been left on the sidelines. The trouble with value When value works, the principle of owning mispriced stocks until the market catches on and corrects them can…