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TOT or CVX: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Oil and Gas - Integrated - International sector have probably already heard of TOTAL SE and Chevron (CVX - 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.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

TOTAL SE and Chevron are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that TOT is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.

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.

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 13.06, while CVX has a forward P/E of 28.19. We also note that TOT has a PEG ratio of 0.73. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. CVX currently has a PEG ratio of 5.64.

Another notable valuation metric for TOT is its P/B ratio of 1.17. 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, CVX has a P/B of 1.44.

These are just a few of the metrics contributing to TOT's Value grade of A and CVX's Value grade of C.

TOT sticks out from CVX in both our Zacks Rank and Style Scores models, so value investors will likely feel that TOT is the better option right now.


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