Are Investors Undervaluing Companhia Paranaense de Energia COPEL (ELP) Right Now?
Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One stock to keep an eye on is Companhia Paranaense de Energia COPEL (ELP). ELP is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 11.93 right now. For comparison, its industry sports an average P/E of 14.29. Over the last 12 months, ELP's Forward P/E has been as high as 13.47 and as low as 8.97, with a median of 10.54.
We should also highlight that ELP has a P/B ratio of 1.04. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. ELP's current P/B looks attractive when compared to its industry's average P/B of 2.23. ELP's P/B has been as high as 1.08 and as low as 0.74, with a median of 0.89, over the past year.
Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. This is a popular metric because sales are harder to manipulate on an income statement, so they are often considered a better performance indicator. ELP has a P/S ratio of 0.79. This compares to its industry's average P/S of 1.89.
If you're looking for another solid Utility - Electric Power value stock, take a look at E.ON (EONGY). EONGY is a # 2 (Buy) stock with a Value score of A.
Shares of E.ON are currently trading at a forward earnings multiple of 12.34 and a PEG ratio of 1.25 compared to its industry's P/E and PEG ratios of 14.29 and 2.01, respectively.
Over the last 12 months, EONGY's P/E has been as high as 13.85, as low as 7.81, with a median of 10.88, and its PEG ratio has been as high as 1.35, as low as 0.94, with a median of 1.12.
E.ON also has a P/B ratio of 1.30 compared to its industry's price-to-book ratio of 2.23. Over the past year, its P/B ratio has been as high as 1.40, as low as 0.74, with a median of 1.03.
These are just a handful of the figures considered in Companhia Paranaense de Energia COPEL and E.ON's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that ELP and EONGY is an impressive value stock right now.
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Companhia Paranaense de Energia (COPEL) (ELP) : Free Stock Analysis Report
E.ON SE (EONGY) : Free Stock Analysis Report
