Value Investing: What is it and is it Still a Viable Strategy?

Oliver Krzeczowski, Walter Payton College Prep, Senior, Fall 2025

In a world where the immediate flow of information across news and social media sources causes rapid changes within capital markets, value investing has become seemingly overlooked. Yet, since 1927, value stocks have outperformed growth stocks by 4.4% annually (Dimensional Fund Advisors, 2023). 

In a simplified manner, value investing is an investment strategy focused on purchasing stocks undervalued by the market, compared to their intrinsic values. Instead of following growth trends, value investors aim to find fundamentally strong, established companies with positive future outlooks that the market currently discounts. Value investors conduct research by reviewing cash flow statements, analyzing industry competition and outlook, and creating models like discounted cash flow models. In doing so, investors hope to uncover a reasonable margin of safety or an intrinsic value far enough above the market value that taking a risk and purchasing the stock makes sense. 

For it to function, value investing assumes a rational world in which mispricing corrects itself. Yet some investors believe that our current market is inefficient, where it’s driven by momentum and expanded narratives, not balance sheets (Osman, 2025). This, paired with growth’s 4.5% favor over value in recent years (Gannatti, 2025), has caused many value investors to examine catalysts as part of their analysis. Portfolio manager and founder of Crossing WallStreet, Eddy Elfenbein, believes that you can still find mispricing in the market, however, he suspects that more people today look for catalysts rather than just cheap assets. Even in uncertain market conditions, with a heavier emphasis placed on growth than ever before, investors can still look for fundamentally undervalued firms.

Those seeking to explore value investing should first look for value in their own lives. Senior Client Solutions Director and VP at Dimensional Fund Advisors, Wes Cril, says that the principle of paying a low price relative to company fundamentals is everywhere, “whether it’s houses, schools, shoes, or sushi restaurants, we implicitly evaluate these tradeoffs all the time”. In value investing, though, it’s important to remember that value doesn’t just mean cheap; rather, it means paying a low price for firm productivity, which could mean paying a reasonable price for a highly productive company. 

To learn more about value investing, books like The Intelligent Investor by Benjamin Graham and Peter Lynch’s Once Upon Wall Street could aid in developing a fundamental understanding.