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ROST or TJX: Which Is the Better Value Stock Right Now?
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Investors looking for stocks in the Retail - Discount Stores sector might want to consider either Ross Stores (ROST - Free Report) or TJX (TJX - 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Ross Stores has a Zacks Rank of #2 (Buy), while TJX has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that ROST likely has seen a stronger improvement to its earnings outlook than TJX has recently. But this is only part of the picture for value investors.
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.
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.
ROST currently has a forward P/E ratio of 22.61, while TJX has a forward P/E of 24.89. We also note that ROST has a PEG ratio of 1.95. 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. TJX currently has a PEG ratio of 2.24.
Another notable valuation metric for ROST is its P/B ratio of 9.04. 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, TJX has a P/B of 16.
Based on these metrics and many more, ROST holds a Value grade of B, while TJX has a Value grade of C.
ROST stands above TJX thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ROST is the superior value option right now.
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ROST or TJX: Which Is the Better Value Stock Right Now?
Investors looking for stocks in the Retail - Discount Stores sector might want to consider either Ross Stores (ROST - Free Report) or TJX (TJX - 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Currently, Ross Stores has a Zacks Rank of #2 (Buy), while TJX has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that ROST likely has seen a stronger improvement to its earnings outlook than TJX has recently. But this is only part of the picture for value investors.
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.
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.
ROST currently has a forward P/E ratio of 22.61, while TJX has a forward P/E of 24.89. We also note that ROST has a PEG ratio of 1.95. 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. TJX currently has a PEG ratio of 2.24.
Another notable valuation metric for ROST is its P/B ratio of 9.04. 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, TJX has a P/B of 16.
Based on these metrics and many more, ROST holds a Value grade of B, while TJX has a Value grade of C.
ROST stands above TJX thanks to its solid earnings outlook, and based on these valuation figures, we also feel that ROST is the superior value option right now.