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CNX or LNG: Which Is the Better Value Stock Right Now?

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·2 min read
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  • CNX
  • LNG

Investors with an interest in Oil and Gas - Exploration and Production - United States stocks have likely encountered both CNX Resources Corporation. (CNX) and Cheniere Energy (LNG). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Both CNX Resources Corporation. and Cheniere Energy have a Zacks Rank of # 1 (Strong Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is just one piece of the puzzle for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

CNX currently has a forward P/E ratio of 11.84, while LNG has a forward P/E of 31.76. We also note that CNX has a PEG ratio of 0.35. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. LNG currently has a PEG ratio of 1.09.

Another notable valuation metric for CNX is its P/B ratio of 1.05. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, LNG has a P/B of 11.25.

Based on these metrics and many more, CNX holds a Value grade of B, while LNG has a Value grade of D.

Both CNX and LNG are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that CNX is the superior value option right now.


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CNX Resources Corporation. (CNX) : Free Stock Analysis Report
 
Cheniere Energy, Inc. (LNG) : Free Stock Analysis Report
 
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