Which stock is the best value right now?

Investors interested in Utility – Electric Power stocks are likely familiar with DTE Energy ( DTE ) and NextEra Energy ( NEE ). But which of these two stocks is more attractive to value investors? We’ll have to take a closer look to find out.

Everyone has their own methods of 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 emphasizes earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific characteristics.

Currently, DTE Energy has a Zacks Rank of #2 (Buy), while NextEra Energy has a Zacks Rank of #3 (Hold). Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should be confident that DTE has an improved earnings outlook. But value investors will care about much more than just this.

Value investors are also interested in a number of proven valuation metrics that help show when a company is undervalued at its current share price levels.

The Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share. share and a number of other fundamental factors that help us determine a company’s fair value.

DTE currently has a forward P/E ratio of 17.78 while NEE has a forward P/E of 22.40. We also note that DTE has a PEG ratio of 2.21. This number is similar to the commonly used P/E ratio, where the PEG ratio also takes into account a company’s expected earnings growth. NEE currently has a PEG ratio of 2.76.

Another notable valuation metric for DTE is its P/B ratio of 2.14. The P/B ratio is used to compare a stock’s market value to its book value, which is defined as total assets minus total liabilities. In comparison, NEE has a P/B of 2.64.

These are just a few of the metrics that contribute to DTE’s value class B and NEE’s value grade of D.

DTE currently has an improved earnings outlook, making it a standout in our Zacks Rank model. And based on the above valuation metrics, we feel that DTE is likely the superior value option right now.

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DTE Energy Company (DTE): Free Stock Analysis Report

NextEra Energy, Inc. (NEE): Free Stock Analysis Report

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