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POR or MGEE: Which Is the Better Value Stock Right Now?

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Investors with an interest in Utility - Electric Power stocks have likely encountered both PGE (POR - Free Report) and MGE (MGEE - 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.

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 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.

Right now, PGE is sporting a Zacks Rank of #2 (Buy), while MGE has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that POR is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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 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.

POR currently has a forward P/E ratio of 26.37, while MGEE has a forward P/E of 26.44. We also note that POR has a PEG ratio of 4.81. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. MGEE currently has a PEG ratio of 5.45.

Another notable valuation metric for POR is its P/B ratio of 1.42. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, MGEE has a P/B of 2.63.

Based on these metrics and many more, POR holds a Value grade of B, while MGEE has a Value grade of D.

POR 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 POR is likely the superior value option right now.


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