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PVH or LULU: Which Is the Better Value Stock Right Now?
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Investors interested in stocks from the Textile - Apparel sector have probably already heard of PVH (PVH - Free Report) and Lululemon (LULU - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.
PVH has a Zacks Rank of #2 (Buy), while Lululemon 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 PVH has an improving earnings outlook. 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.
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.
PVH currently has a forward P/E ratio of 8.39, while LULU has a forward P/E of 33.18. We also note that PVH has a PEG ratio of 0.52. 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. LULU currently has a PEG ratio of 1.66.
Another notable valuation metric for PVH is its P/B ratio of 1.06. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, LULU has a P/B of 14.78.
These metrics, and several others, help PVH earn a Value grade of A, while LULU has been given a Value grade of D.
PVH has seen stronger estimate revision activity and sports more attractive valuation metrics than LULU, so it seems like value investors will conclude that PVH is the superior option right now.
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PVH or LULU: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Textile - Apparel sector have probably already heard of PVH (PVH - Free Report) and Lululemon (LULU - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.
PVH has a Zacks Rank of #2 (Buy), while Lululemon 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 PVH has an improving earnings outlook. 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.
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.
PVH currently has a forward P/E ratio of 8.39, while LULU has a forward P/E of 33.18. We also note that PVH has a PEG ratio of 0.52. 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. LULU currently has a PEG ratio of 1.66.
Another notable valuation metric for PVH is its P/B ratio of 1.06. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, LULU has a P/B of 14.78.
These metrics, and several others, help PVH earn a Value grade of A, while LULU has been given a Value grade of D.
PVH has seen stronger estimate revision activity and sports more attractive valuation metrics than LULU, so it seems like value investors will conclude that PVH is the superior option right now.