LCUT vs. PBH: Which Stock Is the Better Value Option?

PBH LCUT

Investors interested in Consumer Products - Discretionary stocks are likely familiar with Lifetime Brands (LCUT - Free Report) and Prestige Brands (PBH - Free Report) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

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

Currently, Lifetime Brands has a Zacks Rank of #1 (Strong Buy), while Prestige Brands has a Zacks Rank of #4 (Sell). This means that LCUT's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.

Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.

LCUT currently has a forward P/E ratio of 8.08, while PBH has a forward P/E of 13.32. We also note that LCUT has a PEG ratio of 0.58. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. PBH currently has a PEG ratio of 1.66.

Another notable valuation metric for LCUT is its P/B ratio of 0.46. 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, PBH has a P/B of 1.97.

These metrics, and several others, help LCUT earn a Value grade of A, while PBH has been given a Value grade of C.

LCUT is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that LCUT is likely the superior value option right now.

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