Investors looking for stocks in the Oil and Gas - Field Services sector might want to consider either ProPetro Holding (PUMP) or Core Laboratories (CLB). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.
ProPetro Holding and Core Laboratories are sporting Zacks Ranks of #2 (Buy) and #5 (Strong Sell), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that PUMP has an improving earnings 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 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.
PUMP currently has a forward P/E ratio of 7.64, while CLB has a forward P/E of 27.45. We also note that PUMP has a PEG ratio of 0.58. 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. CLB currently has a PEG ratio of 2.81.
Another notable valuation metric for PUMP is its P/B ratio of 2.35. 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, CLB has a P/B of 12.65.
Based on these metrics and many more, PUMP holds a Value grade of A, while CLB has a Value grade of D.
PUMP is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that PUMP is likely the superior value option right now.
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ProPetro Holding Corp. (PUMP) : Free Stock Analysis Report
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