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PVH or VFC: Which Is the Better Value Stock Right Now?

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Investors interested in Textile - Apparel stocks are likely familiar with PVH (PVH - Free Report) and V.F. (VFC - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.

Everyone has their own methods for 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

PVH has a Zacks Rank of #2 (Buy), while V.F. has a Zacks Rank of #3 (Hold) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that PVH is likely seeing its earnings outlook improve to a greater extent. But this is just one factor that value investors are interested in.

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.

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, and a variety of other fundamentals that help us determine a company's fair value.

PVH currently has a forward P/E ratio of 10.33, while VFC has a forward P/E of 26.50. We also note that PVH has a PEG ratio of 0.98. 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. VFC currently has a PEG ratio of 2.63.

Another notable valuation metric for PVH is its P/B ratio of 1.21. 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, VFC has a P/B of 7.65.

These metrics, and several others, help PVH earn a Value grade of A, while VFC has been given a Value grade of D.

PVH sticks out from VFC in both our Zacks Rank and Style Scores models, so value investors will likely feel that PVH is the better option right now.


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