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FL vs. PPRUY: Which Stock Is the Better Value Option?

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Investors with an interest in Retail - Apparel and Shoes stocks have likely encountered both Foot Locker (FL - Free Report) and Kering SA (PPRUY - Free Report) . But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.

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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Foot Locker has a Zacks Rank of #2 (Buy), while Kering SA has a Zacks Rank of #4 (Sell) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that FL is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their current share price levels.

Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.

FL currently has a forward P/E ratio of 7.08, while PPRUY has a forward P/E of 14.27. We also note that FL has a PEG ratio of 0.22. 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. PPRUY currently has a PEG ratio of 1.71.

Another notable valuation metric for FL is its P/B ratio of 0.90. 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, PPRUY has a P/B of 3.93.

These are just a few of the metrics contributing to FL's Value grade of A and PPRUY's Value grade of C.

FL stands above PPRUY thanks to its solid earnings outlook, and based on these valuation figures, we also feel that FL is the superior value option right now.


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