We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
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.
MPLX or WMB: Which Is the Better Value Stock Right Now?
Read MoreHide Full Article
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 is more attractive to value investors? We'll need to take a closer look to find out.
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.
Currently, MPLX LP has a Zacks Rank of #2 (Buy), while Williams Companies, Inc. (The) has a Zacks Rank of #3 (Hold). This means that MPLX's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture 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.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
MPLX currently has a forward P/E ratio of 10.42, while WMB has a forward P/E of 26.16. We also note that MPLX has a PEG ratio of 1.22. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. WMB currently has a PEG ratio of 6.93.
Another notable valuation metric for MPLX is its P/B ratio of 3.33. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, WMB has a P/B of 3.84.
These are just a few of the metrics contributing to MPLX's Value grade of B and WMB's Value grade of D.
MPLX stands above WMB thanks to its solid earnings outlook, and based on these valuation figures, we also feel that MPLX is the superior value option right now.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
MPLX or WMB: Which Is the Better Value Stock Right Now?
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 is more attractive to value investors? We'll need to take a closer look to find out.
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.
Currently, MPLX LP has a Zacks Rank of #2 (Buy), while Williams Companies, Inc. (The) has a Zacks Rank of #3 (Hold). This means that MPLX's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture 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.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
MPLX currently has a forward P/E ratio of 10.42, while WMB has a forward P/E of 26.16. We also note that MPLX has a PEG ratio of 1.22. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. WMB currently has a PEG ratio of 6.93.
Another notable valuation metric for MPLX is its P/B ratio of 3.33. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, WMB has a P/B of 3.84.
These are just a few of the metrics contributing to MPLX's Value grade of B and WMB's Value grade of D.
MPLX stands above WMB thanks to its solid earnings outlook, and based on these valuation figures, we also feel that MPLX is the superior value option right now.