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BURBY or PPRUY: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Retail - Apparel and Shoes sector have probably already heard of Burberry Group PLC (BURBY - Free Report) and Kering SA (PPRUY - 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.

Burberry Group PLC has a Zacks Rank of #2 (Buy), while Kering SA has a Zacks Rank of #4 (Sell) right now. This means that BURBY's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.

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.

BURBY currently has a forward P/E ratio of 16.88, while PPRUY has a forward P/E of 17.44. We also note that BURBY has a PEG ratio of 1.32. 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. PPRUY currently has a PEG ratio of 2.09.

Another notable valuation metric for BURBY is its P/B ratio of 4.46. 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, PPRUY has a P/B of 4.74.

These are just a few of the metrics contributing to BURBY's Value grade of B and PPRUY's Value grade of C.

BURBY has seen stronger estimate revision activity and sports more attractive valuation metrics than PPRUY, so it seems like value investors will conclude that BURBY is the superior option right now.


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