TOT vs. XOM: Which Stock Should Value Investors Buy Now?

XOM

Investors interested in Oil and Gas - Integrated - International stocks are likely familiar with TOTAL SE and Exxon Mobil (XOM - 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.

Both TOTAL SE and Exxon Mobil have a Zacks Rank of # 1 (Strong Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is just one piece of the puzzle for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

TOT currently has a forward P/E ratio of 11.23, while XOM has a forward P/E of 17.67. We also note that TOT has a PEG ratio of 0.60. 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. XOM currently has a PEG ratio of 1.86.

Another notable valuation metric for TOT is its P/B ratio of 1.15. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, XOM has a P/B of 1.46.

These are just a few of the metrics contributing to TOT's Value grade of B and XOM's Value grade of D.

Both TOT and XOM are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that TOT is the superior value option right now.

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