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Are Investors Undervaluing Eni (E) Right Now?

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Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors rely on traditional forms of analysis on key valuation metrics to find stocks that they believe are undervalued, leaving room for profits.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company to watch right now is Eni (E - Free Report) . E is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 3.41 right now. For comparison, its industry sports an average P/E of 5.97. Over the past 52 weeks, E's Forward P/E has been as high as 10.35 and as low as 3.36, with a median of 7.49.

E is also sporting a PEG ratio of 0.33. 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. E's industry has an average PEG of 0.46 right now. Over the last 12 months, E's PEG has been as high as 1.27 and as low as 0.33, with a median of 0.50.

Investors should also recognize that E has a P/B ratio of 0.75. 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. This company's current P/B looks solid when compared to its industry's average P/B of 1.30. Within the past 52 weeks, E's P/B has been as high as 1.13 and as low as 0.72, with a median of 1.

Value investors also use the P/S ratio. The P/S ratio is is calculated as price divided by sales. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. E has a P/S ratio of 0.39. This compares to its industry's average P/S of 0.6.

Finally, our model also underscores that E has a P/CF ratio of 2.17. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. E's P/CF compares to its industry's average P/CF of 5.62. E's P/CF has been as high as 6.20 and as low as 2.08, with a median of 3.54, all within the past year.

If you're looking for another solid Oil and Gas - Integrated - International value stock, take a look at Shell (SHEL - Free Report) . SHEL is a # 2 (Buy) stock with a Value score of A.

Shares of Shell currently holds a Forward P/E ratio of 4.80, and its PEG ratio is 0.59. In comparison, its industry sports average P/E and PEG ratios of 5.97 and 0.46.

Over the last 12 months, SHEL's P/E has been as high as 9.46, as low as 4.48, with a median of 7.04, and its PEG ratio has been as high as 2.37, as low as 0.56, with a median of 1.75.

Furthermore, Shell holds a P/B ratio of 1.07 and its industry's price-to-book ratio is 1.30. SHEL's P/B has been as high as 1.31, as low as 0.86, with a median of 1.08 over the past 12 months.

These are just a handful of the figures considered in Eni and Shell's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that E and SHEL is an impressive value stock right now.


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