TNK or KEX: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Transportation - Shipping sector have probably already heard of Teekay Tankers (TNK) and Kirby (KEX). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Both Teekay Tankers and Kirby have a Zacks Rank of # 2 (Buy) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. But this is only part of the picture for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.
TNK currently has a forward P/E ratio of 2.84, while KEX has a forward P/E of 22.97. We also note that TNK has a PEG ratio of 0.95. 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. KEX currently has a PEG ratio of 1.91.
Another notable valuation metric for TNK is its P/B ratio of 0.98. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, KEX has a P/B of 1.64.
These metrics, and several others, help TNK earn a Value grade of A, while KEX has been given a Value grade of C.
Both TNK and KEX are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that TNK is the superior value option right now.
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Teekay Tankers Ltd. (TNK) : Free Stock Analysis Report
Kirby Corporation (KEX) : Free Stock Analysis Report
