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AEO or DECK: 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 American Eagle Outfitters (AEO - Free Report) and Deckers (DECK - 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
American Eagle Outfitters and Deckers are both sporting a Zacks Rank of # 1 (Strong Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle 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.
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.
AEO currently has a forward P/E ratio of 13.33, while DECK has a forward P/E of 25.10. We also note that AEO has a PEG ratio of 0.87. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. DECK currently has a PEG ratio of 1.40.
Another notable valuation metric for AEO is its P/B ratio of 2.04. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, DECK has a P/B of 8.51.
These metrics, and several others, help AEO earn a Value grade of A, while DECK has been given a Value grade of D.
Both AEO and DECK are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that AEO is the superior value option right now.
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AEO or DECK: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Retail - Apparel and Shoes sector have probably already heard of American Eagle Outfitters (AEO - Free Report) and Deckers (DECK - 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
American Eagle Outfitters and Deckers are both sporting a Zacks Rank of # 1 (Strong Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one piece of the puzzle 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.
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.
AEO currently has a forward P/E ratio of 13.33, while DECK has a forward P/E of 25.10. We also note that AEO has a PEG ratio of 0.87. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. DECK currently has a PEG ratio of 1.40.
Another notable valuation metric for AEO is its P/B ratio of 2.04. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, DECK has a P/B of 8.51.
These metrics, and several others, help AEO earn a Value grade of A, while DECK has been given a Value grade of D.
Both AEO and DECK are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that AEO is the superior value option right now.