Any stock that trades at a cheap valuation compared to its current earnings can technically be called a value stock, regardless of how quickly it is growing. In other words, the terms value stock and growth stock are not mutually exclusive.

Even so, the term value stock most often refers to a mature businesses that generates stable revenue and earnings. Warren Buffett has made a fortune investing in companies that fit that mold, and he possesses an uncanny ability to identify great bargains in the stock market. For instance, Coca-Cola, American Express, and Moody's account for more than 17% of Buffett's portfolio, and all three stocks have skyrocketed more than 1,500% since he bought them.

However, Buffett also has stakes in a few companies that don't fit the value stock mold, including Snowflake (NYSE: SNOW) and Amazon (NASDAQ: AMZN). Both companies are difficult to value based on current earnings, as neither generated a GAAP profit in the most recent quarter. Instead, the market tends to value these stocks based on long-term growth potential.

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Source Fool.com