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NEP vs. CWEN: Which Stock Is the Better Value Option?
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Investors with an interest in Alternative Energy - Other stocks have likely encountered both NextEra Energy Partners (NEP - Free Report) and Clearway Energy (CWEN - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
NextEra Energy Partners and Clearway Energy are both sporting a Zacks Rank of # 1 (Strong Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is just one piece of the puzzle 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
NEP currently has a forward P/E ratio of 15.20, while CWEN has a forward P/E of 31.90. We also note that NEP has a PEG ratio of 1.52. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. CWEN currently has a PEG ratio of 1.81.
Another notable valuation metric for NEP is its P/B ratio of 0.48. 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, CWEN has a P/B of 1.53.
These metrics, and several others, help NEP earn a Value grade of B, while CWEN has been given a Value grade of C.
Both NEP and CWEN are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that NEP is the superior value option right now.
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NEP vs. CWEN: Which Stock Is the Better Value Option?
Investors with an interest in Alternative Energy - Other stocks have likely encountered both NextEra Energy Partners (NEP - Free Report) and Clearway Energy (CWEN - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
NextEra Energy Partners and Clearway Energy are both sporting a Zacks Rank of # 1 (Strong Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is just one piece of the puzzle 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.
The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.
NEP currently has a forward P/E ratio of 15.20, while CWEN has a forward P/E of 31.90. We also note that NEP has a PEG ratio of 1.52. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. CWEN currently has a PEG ratio of 1.81.
Another notable valuation metric for NEP is its P/B ratio of 0.48. 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, CWEN has a P/B of 1.53.
These metrics, and several others, help NEP earn a Value grade of B, while CWEN has been given a Value grade of C.
Both NEP and CWEN are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that NEP is the superior value option right now.