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EONGY or EXC: Which Is the Better Value Stock Right Now?

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Investors looking for stocks in the Utility - Electric Power sector might want to consider either E.ON SE (EONGY - Free Report) or Exelon (EXC - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

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.

Currently, E.ON SE has a Zacks Rank of #2 (Buy), while Exelon has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that EONGY likely has seen a stronger improvement to its earnings outlook than EXC has recently. But this is just one piece of the puzzle for value investors.

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 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.

EONGY currently has a forward P/E ratio of 9.91, while EXC has a forward P/E of 17.20. We also note that EONGY has a PEG ratio of 0.77. 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. EXC currently has a PEG ratio of 2.73.

Another notable valuation metric for EONGY is its P/B ratio of 1.39. 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, EXC has a P/B of 1.61.

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

EONGY has seen stronger estimate revision activity and sports more attractive valuation metrics than EXC, so it seems like value investors will conclude that EONGY is the superior option right now.


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