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PUMP vs. RES: Which Stock Is the Better Value Option?

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Investors interested in Oil and Gas - Field Services stocks are likely familiar with ProPetro Holding (PUMP - Free Report) and RPC (RES - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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.

ProPetro Holding has a Zacks Rank of #2 (Buy), while RPC 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 PUMP has an improving earnings outlook. But this is just one factor that value investors are interested in.

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.

PUMP currently has a forward P/E ratio of 8.91, while RES has a forward P/E of 33.55. We also note that PUMP has a PEG ratio of 1.51. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. RES currently has a PEG ratio of 2.78.

Another notable valuation metric for PUMP is its P/B ratio of 2.08. 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, RES has a P/B of 2.21.

These are just a few of the metrics contributing to PUMP's Value grade of A and RES's Value grade of C.

PUMP stands above RES thanks to its solid earnings outlook, and based on these valuation figures, we also feel that PUMP is the superior value option right now.


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