What are value and growth stocks?

Value and growth stocks are two different styles of stock. Growth stocks are anticipated to grow at a rate above the average for the market. Value stocks are those that tend to trade at a lower price relative to their fundamentals. To determine whether a stock is underpriced, market analysts look at a company’s fundamentals (such as dividends, earnings, and sales) relative to its current share price. Growth stocks tend to be riskier investments and generally do not pay dividends.