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MPLX vs. WMB: Which Stock Is the Better Value Option?
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Investors interested in stocks from the Oil and Gas - Production and Pipelines sector have probably already heard of MPLX LP (MPLX - Free Report) and Williams Companies, Inc. (The) (WMB - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, MPLX LP is sporting a Zacks Rank of #2 (Buy), while Williams Companies, Inc. (The) has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that MPLX is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.
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.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
MPLX currently has a forward P/E ratio of 10, while WMB has a forward P/E of 25.83. We also note that MPLX has a PEG ratio of 1.18. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. WMB currently has a PEG ratio of 6.84.
Another notable valuation metric for MPLX is its P/B ratio of 3.20. 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, WMB has a P/B of 3.79.
These are just a few of the metrics contributing to MPLX's Value grade of B and WMB's Value grade of D.
MPLX 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 MPLX is likely the superior value option right now.
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MPLX vs. WMB: Which Stock Is the Better Value Option?
Investors interested in stocks from the Oil and Gas - Production and Pipelines sector have probably already heard of MPLX LP (MPLX - Free Report) and Williams Companies, Inc. (The) (WMB - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Right now, MPLX LP is sporting a Zacks Rank of #2 (Buy), while Williams Companies, Inc. (The) has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that MPLX is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.
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.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
MPLX currently has a forward P/E ratio of 10, while WMB has a forward P/E of 25.83. We also note that MPLX has a PEG ratio of 1.18. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. WMB currently has a PEG ratio of 6.84.
Another notable valuation metric for MPLX is its P/B ratio of 3.20. 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, WMB has a P/B of 3.79.
These are just a few of the metrics contributing to MPLX's Value grade of B and WMB's Value grade of D.
MPLX 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 MPLX is likely the superior value option right now.