Q: Which would you prefer any why?
5i Research Answer:
CU is trading at a cheap valutation of 13.6x forward earnings. EPS growth outlook is modest for the next two years, but we expect utilities to bounce back with interest rate pressures potentially being alleviated.
CPX is also trading at a very cheap valuation of 8.9x forward earnings. Both EPS and revenue are expected to see declines in the next two years.
We think that both companies will benefit from an improved interest rate environment due to the high capital requirements in their industries. We are more familiar with CPX and would prefer it. They have done some acquisitions that should fuel growth longer-term.