Investors interested in Utility - Electric Power stocks are likely familiar with Portland General Electric (POR) and E.ON SE (EONGY). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Right now, Portland General Electric is sporting a Zacks Rank of #2 (Buy), while E.ON SE has a Zacks Rank of #3 (Hold). This means that POR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether a company is undervalued at its current share price levels.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
POR currently has a forward P/E ratio of 15.14, while EONGY has a forward P/E of 16.45. We also note that POR has a PEG ratio of 4.46. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. EONGY currently has a PEG ratio of 6.09.
Another notable valuation metric for POR is its P/B ratio of 1.45. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, EONGY has a P/B of 1.9.
These metrics, and several others, help POR earn a Value grade of B, while EONGY has been given a Value grade of C.
POR stands above EONGY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that POR is the superior value option right now.
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Portland General Electric Company (POR): Free Stock Analysis Report E.ON SE (EONGY): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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