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TTE or ORA: Which Is the Better Value Stock Right Now?

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Investors interested in Alternative Energy - Other stocks are likely familiar with TotalEnergies SE Sponsored ADR (TTE - Free Report) and Ormat Technologies (ORA - 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.

TotalEnergies SE Sponsored ADR has a Zacks Rank of #1 (Strong Buy), while Ormat Technologies has a Zacks Rank of #3 (Hold) right now. This means that TTE'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 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.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

TTE currently has a forward P/E ratio of 4.76, while ORA has a forward P/E of 63.54. We also note that TTE has a PEG ratio of 0.73. 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 3.98.

Another notable valuation metric for TTE is its P/B ratio of 1.15. 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, ORA has a P/B of 2.28.

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

TTE has seen stronger estimate revision activity and sports more attractive valuation metrics than ORA, so it seems like value investors will conclude that TTE is the superior option right now.


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