Yahoo Finance AY vs. BE: Which Stock Should Value Investors Buy Now?
Investors interested in stocks from the Alternative Energy - Other sector have probably already heard of Atlantica Sustainable Infrastructure (AY) and Bloom Energy (BE). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.
Atlantica Sustainable Infrastructure and Bloom Energy are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that AY's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.
AY currently has a forward P/E ratio of 39.49, while BE has a forward P/E of 82.60. We also note that AY has a PEG ratio of 1.08. 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. BE currently has a PEG ratio of 3.30.
Another notable valuation metric for AY is its P/B ratio of 1.40. 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, BE has a P/B of 4.91.
These are just a few of the metrics contributing to AY's Value grade of A and BE's Value grade of D.
AY has seen stronger estimate revision activity and sports more attractive valuation metrics than BE, so it seems like value investors will conclude that AY is the superior option right now.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Atlantica Sustainable Infrastructure PLC (AY) : Free Stock Analysis Report
Bloom Energy Corporation (BE) : Free Stock Analysis Report
