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EC vs. XOM: Which Stock Is the Better Value Option?
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Investors interested in Oil and Gas - Integrated - International stocks are likely familiar with Ecopetrol (EC - Free Report) and Exxon Mobil (XOM - 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Ecopetrol and Exxon Mobil are both sporting a Zacks Rank of #1 (Strong Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle for value investors.
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 Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
EC currently has a forward P/E ratio of 5.78, while XOM has a forward P/E of 13.61. We also note that EC has a PEG ratio of 0.66. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. XOM currently has a PEG ratio of 0.68.
Another notable valuation metric for EC is its P/B ratio of 1.32. 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, XOM has a P/B of 2.48.
These metrics, and several others, help EC earn a Value grade of A, while XOM has been given a Value grade of C.
Both EC and XOM are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that EC is the superior value option right now.
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EC vs. XOM: Which Stock Is the Better Value Option?
Investors interested in Oil and Gas - Integrated - International stocks are likely familiar with Ecopetrol (EC - Free Report) and Exxon Mobil (XOM - 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.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
Ecopetrol and Exxon Mobil are both sporting a Zacks Rank of #1 (Strong Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle for value investors.
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 Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
EC currently has a forward P/E ratio of 5.78, while XOM has a forward P/E of 13.61. We also note that EC has a PEG ratio of 0.66. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. XOM currently has a PEG ratio of 0.68.
Another notable valuation metric for EC is its P/B ratio of 1.32. 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, XOM has a P/B of 2.48.
These metrics, and several others, help EC earn a Value grade of A, while XOM has been given a Value grade of C.
Both EC and XOM are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that EC is the superior value option right now.