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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company value investors might notice is Tapestry (TPR - Free Report) . TPR is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 10.28, which compares to its industry's average of 16.62. Over the last 12 months, TPR's Forward P/E has been as high as 11.43 and as low as 6.25, with a median of 9.41.
We also note that TPR holds a PEG ratio of 0.89. 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. TPR's industry has an average PEG of 1.05 right now. Over the last 12 months, TPR's PEG has been as high as 0.91 and as low as 0.54, with a median of 0.78.
Investors should also recognize that TPR has a P/B ratio of 3.92. 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. TPR's current P/B looks attractive when compared to its industry's average P/B of 4.29. Over the past year, TPR's P/B has been as high as 4.63 and as low as 2.52, with a median of 3.68.
Finally, our model also underscores that TPR has a P/CF ratio of 9.51. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. TPR's current P/CF looks attractive when compared to its industry's average P/CF of 14.44. Over the past 52 weeks, TPR's P/CF has been as high as 10.81 and as low as 5.53, with a median of 8.51.
Urban Outfitters (URBN - Free Report) may be another strong Retail - Apparel and Shoes stock to add to your shortlist. URBN is a # 2 (Buy) stock with a Value grade of A.
Urban Outfitters is currently trading with a Forward P/E ratio of 11.92 while its PEG ratio sits at 0.66. Both of the company's metrics compare favorably to its industry's average P/E of 16.62 and average PEG ratio of 1.05.
Over the last 12 months, URBN's P/E has been as high as 12.93, as low as 9.40, with a median of 10.87, and its PEG ratio has been as high as 0.72, as low as 0.40, with a median of 0.58.
Urban Outfitters also has a P/B ratio of 1.90 compared to its industry's price-to-book ratio of 4.29. Over the past year, its P/B ratio has been as high as 1.93, as low as 1.32, with a median of 1.58.
Value investors will likely look at more than just these metrics, but the above data helps show that Tapestry and Urban Outfitters are likely undervalued currently. And when considering the strength of its earnings outlook, TPR and URBN sticks out as one of the market's strongest value stocks.
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Is Tapestry (TPR) Stock Undervalued Right Now?
Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.
Of these, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.
Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.
One company value investors might notice is Tapestry (TPR - Free Report) . TPR is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with a P/E ratio of 10.28, which compares to its industry's average of 16.62. Over the last 12 months, TPR's Forward P/E has been as high as 11.43 and as low as 6.25, with a median of 9.41.
We also note that TPR holds a PEG ratio of 0.89. 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. TPR's industry has an average PEG of 1.05 right now. Over the last 12 months, TPR's PEG has been as high as 0.91 and as low as 0.54, with a median of 0.78.
Investors should also recognize that TPR has a P/B ratio of 3.92. 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. TPR's current P/B looks attractive when compared to its industry's average P/B of 4.29. Over the past year, TPR's P/B has been as high as 4.63 and as low as 2.52, with a median of 3.68.
Finally, our model also underscores that TPR has a P/CF ratio of 9.51. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. TPR's current P/CF looks attractive when compared to its industry's average P/CF of 14.44. Over the past 52 weeks, TPR's P/CF has been as high as 10.81 and as low as 5.53, with a median of 8.51.
Urban Outfitters (URBN - Free Report) may be another strong Retail - Apparel and Shoes stock to add to your shortlist. URBN is a # 2 (Buy) stock with a Value grade of A.
Urban Outfitters is currently trading with a Forward P/E ratio of 11.92 while its PEG ratio sits at 0.66. Both of the company's metrics compare favorably to its industry's average P/E of 16.62 and average PEG ratio of 1.05.
Over the last 12 months, URBN's P/E has been as high as 12.93, as low as 9.40, with a median of 10.87, and its PEG ratio has been as high as 0.72, as low as 0.40, with a median of 0.58.
Urban Outfitters also has a P/B ratio of 1.90 compared to its industry's price-to-book ratio of 4.29. Over the past year, its P/B ratio has been as high as 1.93, as low as 1.32, with a median of 1.58.
Value investors will likely look at more than just these metrics, but the above data helps show that Tapestry and Urban Outfitters are likely undervalued currently. And when considering the strength of its earnings outlook, TPR and URBN sticks out as one of the market's strongest value stocks.