How to Invest in Value stocks
Last updated July 2026
Short answer
You can invest in Value stocks by buying the individual stocks that fit the thesis (BAC, CAT, CVS), holding an ETF proxy like VTV, IWD, or building a focused Value stocks portfolio. Value investing rests on a simple observation that is hard to act on: prices move more than businesses do, so a company can trade far below what its cash flows are worth because sentiment has turned against it or its industry. A value portfolio buys that discount and waits for it to close. The difficulty is that a cheap price and a broken business look identical on a screen, and the discipline of the approach is entirely in telling them apart.
What gets a stock into the Value stocks theme?
Companies trading at below-market multiples of earnings, book value or free cash flow, generally with established operations and modest growth expectations.
What stocks are in the Value stocks theme?
Every public name that fits the Value stocks thesis, with the rationale for inclusion. Click any ticker for the full stock guide. The portfolio above starts equal-weighted; you set your own target weights inside Walnut.
Second-largest US bank. Consumer deposit franchise is the structural earnings advantage.
Dominant construction and mining equipment maker with growing data-center power engines and a long dividend record.
CVS Health Corporation provides health solutions in the United States. The Health Care Benefits segment offers traditional, voluntary, and consumer-directed health insurance products and related services, including medical.
Integrated oil major with low-cost production, a strong balance sheet, and a high dividend tied to commodity prices.
First Commonwealth Financial Corporation is the holding company for First Commonwealth Bank, which operates roughly 125 community banking offices across western and central Pennsyl
JPMorgan Chase (NYSE: JPM) is a leading global financial services firm with $4.4 trillion in assets, operating under the J.P.
3M Company is a Minnesota-based industrial manufacturer with a portfolio spanning tens of thousands of products across three reportable segments after its April 2024 spin-off of th
Large diversified pharma with strong cash flow and a high dividend, navigating a post-COVID reset and oncology push.
Largest US health insurer plus the fast-growing Optum health-services and pharmacy-benefits arm; a managed-care anchor.
One of the three national US wireless carriers, pairing mobile and Fios/fixed-wireless broadband with a high dividend, expanding its fiber reach through the Frontier acquisition.
One of the largest US banks, spanning consumer, commercial, corporate and investment banking and wealth management, in a turnaround under CEO Charlie Scharf after the Federal Reserve lifted its asset cap in 2025.
The largest US integrated oil and gas major, combining Permian and Guyana production growth with refining, chemicals, and a 43-year dividend-increase streak.
For the full roundup of the individual names in this theme, grouped by the role each one plays, read best value stocks.
Which ETFs cover Value stocks?
If you want the theme as a single ticker rather than as a portfolio, these are the ETFs people most commonly use. Each has trade-offs (concentration, expense ratio, sector overlap) covered in the individual ETF guides.
The value half of the US large-cap market in one ticker. Roughly 330 cheaper, more dividend-rich large-cap stocks, the counterpart to Vanguard Growth.
Low cost iShares ETF tracking the Russell 1000 Value Index of large and mid cap US value stocks.
The bottom line on Value stocks
Value stocks is best expressed as a focused basket of the names that actually fit the thesis rather than a diluted sector ETF. Core names include BAC, CAT, CVS. In a portfolio it works as a satellite tilt you size deliberately, not a core holding.
FAQ
What makes a stock a value stock?
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Trading at a low price relative to a fundamental measure: earnings, book value, sales or free cash flow. It is a relative label, not an absolute one, since what counts as cheap depends on the market and the sector. Value stocks cluster in financials, energy, healthcare and industrials, and are scarce in fast-growing technology.
What is a value trap?
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A stock that is cheap because the business is genuinely deteriorating, so the multiple never re-rates and earnings keep falling to meet the price. Declining industries produce them constantly. The usual defences are checking whether revenue and free cash flow are stable or shrinking, and whether the balance sheet can survive the decline.
Does value investing still work?
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It underperformed growth for most of the decade after 2010, which led many to declare it dead, and then had periods of sharp outperformance. The long-run academic evidence supports a value premium; the practical evidence is that it can be absent for a very long time. That gap between long-run and lived experience is the hardest part of the approach.
Why do value stocks do well when rates rise?
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Because their profits are largely arriving now rather than far in the future. Higher rates discount distant cash flows more heavily, which hurts companies whose value depends on growth years out and hurts near-term earners much less. This mechanism explains most of value's relative performance in rate-rising periods.
What are the risks of a value portfolio?
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Value traps, where cheap gets cheaper. Long stretches of underperformance that test patience precisely when abandoning the approach is most costly. Sector concentration in financials and energy, which are themselves cyclical. And the possibility that a low multiple correctly reflects a business in permanent decline.
Build the Value stocks portfolio in Walnut
Walnut's AI assistant takes the thesis above, proposes 5 to 6 constituents with target weights, and lets you fund the portfolio through your existing broker. You approve every order; we never trade on your behalf.
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Walnut is informational, not investment advice. Theme membership is descriptive, not prescriptive; nothing on this page should be read as a recommendation. Always verify current financials and your own circumstances before investing.