CWEN or AMRC: Which Is the Better Value Stock Right Now?
Investors interested in Alternative Energy - Other stocks are likely familiar with Clearway Energy (CWEN) and Ameresco (AMRC). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Clearway Energy and Ameresco are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that CWEN's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
CWEN currently has a forward P/E ratio of 15.83, while AMRC has a forward P/E of 35.55. We also note that CWEN has a PEG ratio of 0.90. 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. AMRC currently has a PEG ratio of 1.37.
Another notable valuation metric for CWEN is its P/B ratio of 1.71. 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, AMRC has a P/B of 4.31.
These are just a few of the metrics contributing to CWEN's Value grade of B and AMRC's Value grade of C.
CWEN has seen stronger estimate revision activity and sports more attractive valuation metrics than AMRC, so it seems like value investors will conclude that CWEN is the superior option right now.
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Clearway Energy, Inc. (CWEN) : Free Stock Analysis Report
Ameresco, Inc. (AMRC) : Free Stock Analysis Report
