TNK or KEX: Which Is the Better Value Stock Right Now?
Investors interested in Transportation - Shipping stocks are likely familiar with Teekay Tankers (TNK) and Kirby (KEX). 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Right now, Teekay Tankers is sporting a Zacks Rank of #1 (Strong Buy), while Kirby has a Zacks Rank of #2 (Buy). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that TNK is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.
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.
TNK currently has a forward P/E ratio of 3.25, while KEX has a forward P/E of 22.45. We also note that TNK has a PEG ratio of 1.08. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. KEX currently has a PEG ratio of 1.87.
Another notable valuation metric for TNK is its P/B ratio of 1.14. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, KEX has a P/B of 1.59.
Based on these metrics and many more, TNK holds a Value grade of A, while KEX has a Value grade of C.
TNK 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 TNK is likely 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
