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KNBWY vs. NAPA: Which Stock Should Value Investors Buy Now?

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Investors interested in stocks from the Beverages - Alcohol sector have probably already heard of Kirin Holdings Co. (KNBWY - Free Report) and The Duckhorn Portfolio, Inc. (NAPA - 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.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Kirin Holdings Co. has a Zacks Rank of #2 (Buy), while The Duckhorn Portfolio, Inc. has a Zacks Rank of #3 (Hold) right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that KNBWY has an improving earnings outlook. But this is just one piece of the puzzle for value investors.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks 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.

KNBWY currently has a forward P/E ratio of 16.20, while NAPA has a forward P/E of 45.30. We also note that KNBWY has a PEG ratio of 0.76. 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. NAPA currently has a PEG ratio of 4.33.

Another notable valuation metric for KNBWY is its P/B ratio of 1.57. 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, NAPA has a P/B of 3.28.

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

KNBWY 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 KNBWY is likely the superior value option right now.


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Kirin Holdings Co. (KNBWY) - free report >>

The Duckhorn Portfolio, Inc. (NAPA) - free report >>

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