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NEP vs. BE: Which Stock Is the Better Value Option?
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Investors interested in stocks from the Alternative Energy - Other sector have probably already heard of NextEra Energy Partners (NEP - Free Report) and Bloom Energy (BE - 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, NextEra Energy Partners is sporting a Zacks Rank of #2 (Buy), while Bloom Energy has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that NEP has an improving earnings outlook. However, value investors will care about much more than just this.
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 25.40, while BE has a forward P/E of 405.09. We also note that NEP has a PEG ratio of 2.54. 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. BE currently has a PEG ratio of 16.20.
Another notable valuation metric for NEP is its P/B ratio of 0.52. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, BE has a P/B of 22.76.
Based on these metrics and many more, NEP holds a Value grade of B, while BE has a Value grade of F.
NEP 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 NEP is likely the superior value option right now.
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NEP vs. BE: Which Stock Is the Better Value Option?
Investors interested in stocks from the Alternative Energy - Other sector have probably already heard of NextEra Energy Partners (NEP - Free Report) and Bloom Energy (BE - 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, NextEra Energy Partners is sporting a Zacks Rank of #2 (Buy), while Bloom Energy has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that NEP has an improving earnings outlook. However, value investors will care about much more than just this.
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 25.40, while BE has a forward P/E of 405.09. We also note that NEP has a PEG ratio of 2.54. 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. BE currently has a PEG ratio of 16.20.
Another notable valuation metric for NEP is its P/B ratio of 0.52. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, BE has a P/B of 22.76.
Based on these metrics and many more, NEP holds a Value grade of B, while BE has a Value grade of F.
NEP 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 NEP is likely the superior value option right now.