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Are Investors Undervaluing E.ON (EONGY) Right Now?
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While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company value investors might notice is E.ON (EONGY - Free Report) . EONGY is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 12.04. This compares to its industry's average Forward P/E of 14.43. EONGY's Forward P/E has been as high as 13.20 and as low as 7.81, with a median of 10.39, all within the past year.
We also note that EONGY holds a PEG ratio of 1.25. 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. EONGY's industry has an average PEG of 2.15 right now. Over the past 52 weeks, EONGY's PEG has been as high as 1.58 and as low as 0.94, with a median of 1.24.
Another valuation metric that we should highlight is EONGY's P/B ratio of 1.10. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. EONGY's current P/B looks attractive when compared to its industry's average P/B of 2.07. EONGY's P/B has been as high as 1.70 and as low as 0.73, with a median of 1.01, over the past year.
Finally, investors will want to recognize that EONGY has a P/CF ratio of 3.17. 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. This stock's P/CF looks attractive against its industry's average P/CF of 12.22. EONGY's P/CF has been as high as 3.52 and as low as 2.09, with a median of 2.73, all within the past year.
If you're looking for another solid Utility - Electric Power value stock, take a look at TransAlta (TAC - Free Report) . TAC is a # 1 (Strong Buy) stock with a Value score of A.
TransAlta sports a P/B ratio of 2.20 as well; this compares to its industry's price-to-book ratio of 2.07. In the past 52 weeks, TAC's P/B has been as high as 2.65, as low as 1.87, with a median of 2.20.
These figures are just a handful of the metrics value investors tend to look at, but they help show that E.ON and TransAlta are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, EONGY and TAC feels like a great value stock at the moment.
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Are Investors Undervaluing E.ON (EONGY) Right Now?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company value investors might notice is E.ON (EONGY - Free Report) . EONGY is currently sporting a Zacks Rank of #2 (Buy), as well as a Value grade of A. The stock has a Forward P/E ratio of 12.04. This compares to its industry's average Forward P/E of 14.43. EONGY's Forward P/E has been as high as 13.20 and as low as 7.81, with a median of 10.39, all within the past year.
We also note that EONGY holds a PEG ratio of 1.25. 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. EONGY's industry has an average PEG of 2.15 right now. Over the past 52 weeks, EONGY's PEG has been as high as 1.58 and as low as 0.94, with a median of 1.24.
Another valuation metric that we should highlight is EONGY's P/B ratio of 1.10. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. EONGY's current P/B looks attractive when compared to its industry's average P/B of 2.07. EONGY's P/B has been as high as 1.70 and as low as 0.73, with a median of 1.01, over the past year.
Finally, investors will want to recognize that EONGY has a P/CF ratio of 3.17. 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. This stock's P/CF looks attractive against its industry's average P/CF of 12.22. EONGY's P/CF has been as high as 3.52 and as low as 2.09, with a median of 2.73, all within the past year.
If you're looking for another solid Utility - Electric Power value stock, take a look at TransAlta (TAC - Free Report) . TAC is a # 1 (Strong Buy) stock with a Value score of A.
TransAlta sports a P/B ratio of 2.20 as well; this compares to its industry's price-to-book ratio of 2.07. In the past 52 weeks, TAC's P/B has been as high as 2.65, as low as 1.87, with a median of 2.20.
These figures are just a handful of the metrics value investors tend to look at, but they help show that E.ON and TransAlta are likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, EONGY and TAC feels like a great value stock at the moment.