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DKS or ULTA: Which Is the Better Value Stock Right Now?
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Investors interested in Retail - Miscellaneous stocks are likely familiar with Dick's Sporting Goods (DKS - Free Report) and Ulta Beauty (ULTA - 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.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, Dick's Sporting Goods has a Zacks Rank of #2 (Buy), while Ulta Beauty has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that DKS is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether 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.
DKS currently has a forward P/E ratio of 9.45, while ULTA has a forward P/E of 20.55. We also note that DKS has a PEG ratio of 0.81. 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. ULTA currently has a PEG ratio of 1.58.
Another notable valuation metric for DKS is its P/B ratio of 3.59. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, ULTA has a P/B of 10.06.
Based on these metrics and many more, DKS holds a Value grade of A, while ULTA has a Value grade of C.
DKS 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 DKS is likely the superior value option right now.
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DKS or ULTA: Which Is the Better Value Stock Right Now?
Investors interested in Retail - Miscellaneous stocks are likely familiar with Dick's Sporting Goods (DKS - Free Report) and Ulta Beauty (ULTA - 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.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.
Currently, Dick's Sporting Goods has a Zacks Rank of #2 (Buy), while Ulta Beauty has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that DKS is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture for value investors.
Value investors also try to analyze a wide range of traditional figures and metrics to help determine whether 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.
DKS currently has a forward P/E ratio of 9.45, while ULTA has a forward P/E of 20.55. We also note that DKS has a PEG ratio of 0.81. 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. ULTA currently has a PEG ratio of 1.58.
Another notable valuation metric for DKS is its P/B ratio of 3.59. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, ULTA has a P/B of 10.06.
Based on these metrics and many more, DKS holds a Value grade of A, while ULTA has a Value grade of C.
DKS 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 DKS is likely the superior value option right now.