TNK vs. KEX: Which Stock Is the Better Value Option?
Investors with an interest in Transportation - Shipping stocks have likely encountered both Teekay Tankers (TNK) and Kirby (KEX). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
Teekay Tankers has a Zacks Rank of #1 (Strong Buy), while Kirby has a Zacks Rank of #2 (Buy) right now. 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 just one factor that value investors are interested in.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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 2.79, while KEX has a forward P/E of 21.46. We also note that TNK has a PEG ratio of 0.93. 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 1.79.
Another notable valuation metric for TNK is its P/B ratio of 1.03. 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 1.49.
These metrics, and several others, help TNK earn a Value grade of A, while KEX has been given a Value grade of C.
TNK sticks out from KEX in both our Zacks Rank and Style Scores models, so value investors will likely feel that TNK is the better option right now.
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Teekay Tankers Ltd. (TNK) : Free Stock Analysis Report
Kirby Corporation (KEX) : Free Stock Analysis Report
