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MDU or NJR: Which Is the Better Value Stock Right Now?
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Investors interested in stocks from the Utility - Gas Distribution sector have probably already heard of MDU Resources (MDU - Free Report) and New Jersey Resources (NJR - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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.
MDU Resources and New Jersey Resources are both sporting 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 these stocks have improving earnings outlooks. 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.
MDU currently has a forward P/E ratio of 14.55, while NJR has a forward P/E of 20.16. We also note that MDU has a PEG ratio of 2.43. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. NJR currently has a PEG ratio of 3.36.
Another notable valuation metric for MDU is its P/B ratio of 1.76. 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. By comparison, NJR has a P/B of 2.59.
These are just a few of the metrics contributing to MDU's Value grade of B and NJR's Value grade of D.
Both MDU and NJR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that MDU is the superior value option right now.
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MDU or NJR: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Utility - Gas Distribution sector have probably already heard of MDU Resources (MDU - Free Report) and New Jersey Resources (NJR - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
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.
MDU Resources and New Jersey Resources are both sporting 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 these stocks have improving earnings outlooks. 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.
MDU currently has a forward P/E ratio of 14.55, while NJR has a forward P/E of 20.16. We also note that MDU has a PEG ratio of 2.43. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. NJR currently has a PEG ratio of 3.36.
Another notable valuation metric for MDU is its P/B ratio of 1.76. 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. By comparison, NJR has a P/B of 2.59.
These are just a few of the metrics contributing to MDU's Value grade of B and NJR's Value grade of D.
Both MDU and NJR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that MDU is the superior value option right now.