We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
APA vs. LNG: Which Stock Should Value Investors Buy Now?
Read MoreHide Full Article
Investors interested in stocks from the Oil and Gas - Exploration and Production - United States sector have probably already heard of APA (APA - Free Report) and Cheniere Energy (LNG - 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.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
APA has a Zacks Rank of #2 (Buy), while Cheniere Energy has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that APA has an improving earnings outlook. But this is just one factor that value investors are interested in.
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.
APA currently has a forward P/E ratio of 7.54, while LNG has a forward P/E of 43.85. We also note that APA has a PEG ratio of 0.75. 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. LNG currently has a PEG ratio of 2.92.
Another notable valuation metric for APA is its P/B ratio of 1.94. 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, LNG has a P/B of 4.99.
Based on these metrics and many more, APA holds a Value grade of A, while LNG has a Value grade of C.
APA has seen stronger estimate revision activity and sports more attractive valuation metrics than LNG, so it seems like value investors will conclude that APA is the superior option right now.
View the Zacks #1 Rank List
Image: Bigstock
APA vs. LNG: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Oil and Gas - Exploration and Production - United States sector have probably already heard of APA (APA - Free Report) and Cheniere Energy (LNG - 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.
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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
APA has a Zacks Rank of #2 (Buy), while Cheniere Energy has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that APA has an improving earnings outlook. But this is just one factor that value investors are interested in.
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.
APA currently has a forward P/E ratio of 7.54, while LNG has a forward P/E of 43.85. We also note that APA has a PEG ratio of 0.75. 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. LNG currently has a PEG ratio of 2.92.
Another notable valuation metric for APA is its P/B ratio of 1.94. 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, LNG has a P/B of 4.99.
Based on these metrics and many more, APA holds a Value grade of A, while LNG has a Value grade of C.
APA has seen stronger estimate revision activity and sports more attractive valuation metrics than LNG, so it seems like value investors will conclude that APA is the superior option right now.