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EQNR vs. ORA: Which Stock Should Value Investors Buy Now?

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Investors interested in stocks from the Alternative Energy - Other sector have probably already heard of Equinor (EQNR - Free Report) and Ormat Technologies (ORA - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? 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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Equinor has a Zacks Rank of #1 (Strong Buy), while Ormat Technologies has a Zacks Rank of #3 (Hold) right now. This means that EQNR's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

EQNR currently has a forward P/E ratio of 7.11, while ORA has a forward P/E of 49.51. We also note that EQNR has a PEG ratio of 0.15. 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. ORA currently has a PEG ratio of 4.38.

Another notable valuation metric for EQNR is its P/B ratio of 1.77. 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, ORA has a P/B of 1.98.

Based on these metrics and many more, EQNR holds a Value grade of A, while ORA has a Value grade of C.

EQNR 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 EQNR is likely the superior value option right now.


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Ormat Technologies, Inc. (ORA) - free report >>

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