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KGEI or TLN: Which Is the Better Value Stock Right Now?
Investors interested in Alternative Energy - Other stocks are likely familiar with Kolibri Global Energy Inc. (KGEI - Free Report) and Talen Energy Corporation (TLN - 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.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Both Kolibri Global Energy Inc. and Talen Energy Corporation have 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. However, value investors will care about much more than just this.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether 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.
KGEI currently has a forward P/E ratio of 11.09, while TLN has a forward P/E of 30.15. We also note that KGEI has a PEG ratio of 0.79. 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. TLN currently has a PEG ratio of 2.50.
Another notable valuation metric for KGEI is its P/B ratio of 1.62. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, TLN has a P/B of 4.56.
These are just a few of the metrics contributing to KGEI's Value grade of A and TLN's Value grade of C.
Both KGEI and TLN are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that KGEI is the superior value option right now.