Yahoo Finance EPD vs. OKE: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Oil and Gas - Production Pipeline - MLB sector might want to consider either Enterprise Products Partners (EPD) or Oneok Inc. (OKE). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Enterprise Products Partners has a Zacks Rank of #2 (Buy), while Oneok Inc. 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 EPD has an improving earnings outlook. But this is only part of the picture for value investors.
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.
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.
EPD currently has a forward P/E ratio of 10.57, while OKE has a forward P/E of 16.86. We also note that EPD has a PEG ratio of 1.34. 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. OKE currently has a PEG ratio of 4.47.
Another notable valuation metric for EPD is its P/B ratio of 2.18. 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, OKE has a P/B of 2.95.
These metrics, and several others, help EPD earn a Value grade of A, while OKE has been given a Value grade of C.
EPD has seen stronger estimate revision activity and sports more attractive valuation metrics than OKE, so it seems like value investors will conclude that EPD is the superior option right now.
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Enterprise Products Partners L.P. (EPD) : Free Stock Analysis Report
ONEOK, Inc. (OKE) : Free Stock Analysis Report
