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PNM or MGEE: Which Is the Better Value Stock Right Now?
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Investors interested in Utility - Electric Power stocks are likely familiar with PNM Resources (PNM - 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.
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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
PNM Resources and MGE are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that PNM 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 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.
PNM currently has a forward P/E ratio of 16.32, while MGEE has a forward P/E of 21.54. We also note that PNM has a PEG ratio of 3.63. 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. MGEE currently has a PEG ratio of 4.03.
Another notable valuation metric for PNM is its P/B ratio of 1.64. 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, MGEE has a P/B of 2.32.
These are just a few of the metrics contributing to PNM's Value grade of B and MGEE's Value grade of D.
PNM has seen stronger estimate revision activity and sports more attractive valuation metrics than MGEE, so it seems like value investors will conclude that PNM is the superior option right now.
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PNM or MGEE: Which Is the Better Value Stock Right Now?
Investors interested in Utility - Electric Power stocks are likely familiar with PNM Resources (PNM - 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.
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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
PNM Resources and MGE are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that PNM 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 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.
PNM currently has a forward P/E ratio of 16.32, while MGEE has a forward P/E of 21.54. We also note that PNM has a PEG ratio of 3.63. 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. MGEE currently has a PEG ratio of 4.03.
Another notable valuation metric for PNM is its P/B ratio of 1.64. 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, MGEE has a P/B of 2.32.
These are just a few of the metrics contributing to PNM's Value grade of B and MGEE's Value grade of D.
PNM has seen stronger estimate revision activity and sports more attractive valuation metrics than MGEE, so it seems like value investors will conclude that PNM is the superior option right now.