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FL vs. GPS: Which Stock Should Value Investors Buy Now?
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Investors looking for stocks in the Retail - Apparel and Shoes sector might want to consider either Foot Locker (FL - Free Report) or Gap (GPS - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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.
Currently, Foot Locker has a Zacks Rank of #2 (Buy), while Gap has a Zacks Rank of #5 (Strong Sell). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that FL is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
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 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.
FL currently has a forward P/E ratio of 5.69, while GPS has a forward P/E of 590.67. We also note that FL has a PEG ratio of 0.18. 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. GPS currently has a PEG ratio of 49.22.
Another notable valuation metric for FL is its P/B ratio of 0.76. 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, GPS has a P/B of 1.33.
These are just a few of the metrics contributing to FL's Value grade of A and GPS's Value grade of D.
FL sticks out from GPS in both our Zacks Rank and Style Scores models, so value investors will likely feel that FL is the better option right now.
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FL vs. GPS: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Retail - Apparel and Shoes sector might want to consider either Foot Locker (FL - Free Report) or Gap (GPS - Free Report) . But which of these two stocks presents investors with the better value opportunity right now? Let's 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.
Currently, Foot Locker has a Zacks Rank of #2 (Buy), while Gap has a Zacks Rank of #5 (Strong Sell). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that FL is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
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 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.
FL currently has a forward P/E ratio of 5.69, while GPS has a forward P/E of 590.67. We also note that FL has a PEG ratio of 0.18. 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. GPS currently has a PEG ratio of 49.22.
Another notable valuation metric for FL is its P/B ratio of 0.76. 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, GPS has a P/B of 1.33.
These are just a few of the metrics contributing to FL's Value grade of A and GPS's Value grade of D.
FL sticks out from GPS in both our Zacks Rank and Style Scores models, so value investors will likely feel that FL is the better option right now.