Back to top
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
American Electric Power Company, Inc. (AEP) - free report >>
We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties. You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies. In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
American Electric Power Company, Inc. (AEP) - free report >>
Image: Bigstock
POR or AEP: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Utility - Electric Power sector might want to consider either Portland General Electric (POR - Free Report) or American Electric Power (AEP - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Portland General Electric and American Electric Power are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. Investors should feel comfortable knowing that POR likely has seen a stronger improvement to its earnings outlook than AEP has recently. 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 Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
POR currently has a forward P/E ratio of 13.73, while AEP has a forward P/E of 15.30. We also note that POR has a PEG ratio of 2.67. 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. AEP currently has a PEG ratio of 3.
Another notable valuation metric for POR is its P/B ratio of 1.27. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, AEP has a P/B of 1.76.
Based on these metrics and many more, POR holds a Value grade of B, while AEP has a Value grade of C.
POR sticks out from AEP in both our Zacks Rank and Style Scores models, so value investors will likely feel that POR is the better option right now.