COTY or IPAR: Which Is the Better Value Stock Right Now?

IPAR COTY

Investors with an interest in Cosmetics stocks have likely encountered both Coty (COTY - Free Report) and Inter Parfums (IPAR - 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.

Both Coty and Inter Parfums have a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. However, value investors will care about much more than just this.

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.

COTY currently has a forward P/E ratio of 28.56, while IPAR has a forward P/E of 30.50. We also note that COTY has a PEG ratio of 1.94. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. IPAR currently has a PEG ratio of 2.03.

Another notable valuation metric for COTY is its P/B ratio of 2.35. 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, IPAR has a P/B of 4.97.

Based on these metrics and many more, COTY holds a Value grade of B, while IPAR has a Value grade of D.

Both COTY and IPAR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that COTY is the superior value option right now.

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