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

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Investors interested in Alternative Energy - Other stocks are likely familiar with 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.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Currently, Equinor has a Zacks Rank of #1 (Strong Buy), while Ormat Technologies 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 EQNR is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.

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.

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 8.27, while ORA has a forward P/E of 49.10. We also note that EQNR has a PEG ratio of 0.17. 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 4.17.

Another notable valuation metric for EQNR is its P/B ratio of 1.83. 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, ORA has a P/B of 1.96.

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

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


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

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