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NWE vs. PNW: Which Stock Is the Better Value Option?
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Investors interested in Utility - Electric Power stocks are likely familiar with NorthWestern (NWE - Free Report) and Pinnacle West (PNW - 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.
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.
NorthWestern and Pinnacle West are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This means that NWE's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture 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.
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.
NWE currently has a forward P/E ratio of 15.85, while PNW has a forward P/E of 19.02. We also note that NWE has a PEG ratio of 2.31. 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. PNW currently has a PEG ratio of 8.97.
Another notable valuation metric for NWE is its P/B ratio of 1.22. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, PNW has a P/B of 1.51.
These metrics, and several others, help NWE earn a Value grade of B, while PNW has been given a Value grade of C.
NWE has seen stronger estimate revision activity and sports more attractive valuation metrics than PNW, so it seems like value investors will conclude that NWE is the superior option right now.
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NWE vs. PNW: Which Stock Is the Better Value Option?
Investors interested in Utility - Electric Power stocks are likely familiar with NorthWestern (NWE - Free Report) and Pinnacle West (PNW - 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.
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.
NorthWestern and Pinnacle West are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This means that NWE's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture 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.
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.
NWE currently has a forward P/E ratio of 15.85, while PNW has a forward P/E of 19.02. We also note that NWE has a PEG ratio of 2.31. 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. PNW currently has a PEG ratio of 8.97.
Another notable valuation metric for NWE is its P/B ratio of 1.22. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, PNW has a P/B of 1.51.
These metrics, and several others, help NWE earn a Value grade of B, while PNW has been given a Value grade of C.
NWE has seen stronger estimate revision activity and sports more attractive valuation metrics than PNW, so it seems like value investors will conclude that NWE is the superior option right now.