Back to top

Image: Bigstock

WKC or ORA: Which Is the Better Value Stock Right Now?

Read MoreHide Full Article

Investors interested in Alternative Energy - Other stocks are likely familiar with World Kinect (WKC - Free Report) and Ormat Technologies (ORA - 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.

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 proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

World Kinect and Ormat Technologies are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. Investors should feel comfortable knowing that WKC likely has seen a stronger improvement to its earnings outlook than ORA has recently. However, value investors will care about much more than just this.

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.

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.

WKC currently has a forward P/E ratio of 11.16, while ORA has a forward P/E of 29.71. We also note that WKC has a PEG ratio of 0.92. 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. ORA currently has a PEG ratio of 2.97.

Another notable valuation metric for WKC is its P/B ratio of 0.80. 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, ORA has a P/B of 1.53.

These metrics, and several others, help WKC earn a Value grade of A, while ORA has been given a Value grade of D.

WKC is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that WKC is likely the superior value option right now.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Ormat Technologies, Inc. (ORA) - free report >>

World Kinect Corporation (WKC) - free report >>

Published in