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PNM vs. MGEE: Which Stock Is the Better Value Option?
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Investors looking for stocks in the Utility - Electric Power sector might want to consider either PNM Resources (PNM - Free Report) or MGE (MGEE - 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
PNM Resources and MGE are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This means that PNM's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.
PNM currently has a forward P/E ratio of 15.90, while MGEE has a forward P/E of 21.91. We also note that PNM has a PEG ratio of 3.54. 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 4.09.
Another notable valuation metric for PNM is its P/B ratio of 1.62. 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, MGEE has a P/B of 2.38.
Based on these metrics and many more, PNM holds a Value grade of B, while MGEE has a Value grade of D.
PNM stands above MGEE thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PNM is the superior value option right now.
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PNM vs. MGEE: Which Stock Is the Better Value Option?
Investors looking for stocks in the Utility - Electric Power sector might want to consider either PNM Resources (PNM - Free Report) or MGE (MGEE - 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
PNM Resources and MGE are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This means that PNM's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.
PNM currently has a forward P/E ratio of 15.90, while MGEE has a forward P/E of 21.91. We also note that PNM has a PEG ratio of 3.54. 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 4.09.
Another notable valuation metric for PNM is its P/B ratio of 1.62. 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, MGEE has a P/B of 2.38.
Based on these metrics and many more, PNM holds a Value grade of B, while MGEE has a Value grade of D.
PNM stands above MGEE thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PNM is the superior value option right now.