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TAP or NAPA: Which Is the Better Value Stock Right Now?

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Investors interested in stocks from the Beverages - Alcohol sector have probably already heard of Molson Coors Brewing (TAP - Free Report) and The Duckhorn Portfolio, Inc. (NAPA - 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.

Right now, Molson Coors Brewing is sporting a Zacks Rank of #1 (Strong Buy), while The Duckhorn Portfolio, Inc. has a Zacks Rank of #3 (Hold). This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that TAP is likely seeing its earnings outlook improve to a greater extent. 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.

TAP currently has a forward P/E ratio of 11.14, while NAPA has a forward P/E of 14.15. We also note that TAP has a PEG ratio of 2.20. 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. NAPA currently has a PEG ratio of 7.25.

Another notable valuation metric for TAP is its P/B ratio of 1.01. 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, NAPA has a P/B of 1.13.

Based on these metrics and many more, TAP holds a Value grade of B, while NAPA has a Value grade of C.

TAP sticks out from NAPA in both our Zacks Rank and Style Scores models, so value investors will likely feel that TAP is the better option right now.


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Molson Coors Beverage Company (TAP) - free report >>

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