EONGY vs. CNP: Which Stock Is the Better Value Option?
Investors looking for stocks in the Utility - Electric Power sector might want to consider either E.ON SE (EONGY) or CenterPoint Energy (CNP). 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 proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
E.ON SE and CenterPoint Energy are both sporting a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. 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.
EONGY currently has a forward P/E ratio of 13.05, while CNP has a forward P/E of 18.90. We also note that EONGY has a PEG ratio of 1.57. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. CNP currently has a PEG ratio of 4.03.
Another notable valuation metric for EONGY is its P/B ratio of 1.92. 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, CNP has a P/B of 2.09.
These are just a few of the metrics contributing to EONGY's Value grade of A and CNP's Value grade of D.
Both EONGY and CNP are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that EONGY is the superior value option right now.
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E.ON SE (EONGY) : Free Stock Analysis Report
CenterPoint Energy, Inc. (CNP) : Free Stock Analysis Report
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