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.
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.
Right now, Teekay Tankers is sporting a Zacks Rank of #1 (Strong Buy), while Kirby has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that TNK likely has seen a stronger improvement to its earnings outlook than KEX has recently. But this is just one piece of the puzzle 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 4.08, while KEX has a forward P/E of 17.04. We also note that TNK has a PEG ratio of 1.36. 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 1.42.
Another notable valuation metric for TNK is its P/B ratio of 1.37. 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, KEX has a P/B of 1.60.
These are just a few of the metrics contributing to TNK's Value grade of A and KEX's Value grade of C.
TNK stands above KEX thanks to its solid earnings outlook, and based on these valuation figures, we also 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
