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

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Investors with an interest in Oil and Gas - Integrated - International stocks have likely encountered both Eni SpA (E - Free Report) and Chevron (CVX - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Right now, both Eni SpA and Chevron are sporting a Zacks Rank of # 1 (Strong Buy). 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 factor that value investors are interested in.

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 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.

E currently has a forward P/E ratio of 10.90, while CVX has a forward P/E of 15.43. We also note that E has a PEG ratio of 0.80. 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. CVX currently has a PEG ratio of 3.09.

Another notable valuation metric for E is its P/B ratio of 1.06. 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, CVX has a P/B of 1.65.

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

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


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