Investors interested in Solar stocks are likely familiar with JinkoSolar (JKS - Free Report) and Sunrun (RUN - 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
JinkoSolar has a Zacks Rank of #2 (Buy), while Sunrun has a Zacks Rank of #3 (Hold) right now. Investors should feel comfortable knowing that JKS likely has seen a stronger improvement to its earnings outlook than RUN has recently. However, value investors will care about much more than just this.
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.
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.
JKS currently has a forward P/E ratio of 6.42, while RUN has a forward P/E of 33.86. We also note that JKS has a PEG ratio of 0.32. 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. RUN currently has a PEG ratio of 6.77.
Another notable valuation metric for JKS is its P/B ratio of 0.60. 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, RUN has a P/B of 1.61.
These are just a few of the metrics contributing to JKS's Value grade of A and RUN's Value grade of D.
JKS stands above RUN thanks to its solid earnings outlook, and based on these valuation figures, we also feel that JKS is the superior value option right now.