AVA vs. ED: Which Stock Is the Better Value Option?

Core Viewpoint - The analysis compares Avista (AVA) and Consolidated Edison (ED) to determine which stock offers better value for investors, highlighting AVA's stronger earnings estimate revisions and overall valuation metrics [1]. Group 1: Zacks Rank and Earnings Outlook - Avista (AVA) has a Zacks Rank of 2 (Buy), indicating a favorable earnings estimate revision trend, while Consolidated Edison (ED) has a Zacks Rank of 3 (Hold) [1]. - The improving analyst outlook for AVA suggests a more positive earnings forecast compared to ED [1]. Group 2: Valuation Metrics - AVA has a forward P/E ratio of 15.99, significantly lower than ED's forward P/E of 20.25, indicating that AVA may be undervalued [2]. - The PEG ratio for AVA is 3.32, while ED's PEG ratio is 3.63, suggesting that AVA offers better value relative to its expected earnings growth [2]. - AVA's P/B ratio is 1.19, compared to ED's P/B ratio of 1.72, further supporting the notion that AVA is more attractively priced [2]. Group 3: Overall Value Assessment - Based on the valuation metrics, AVA has earned a Value grade of B, while ED has a Value grade of C, indicating that AVA is currently the superior value option [3]. - The combination of AVA's improving earnings outlook and favorable valuation metrics positions it as a more attractive investment choice compared to ED [3].