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SIG vs. CFRUY: Which Stock Is the Better Value Option?

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Investors with an interest in Retail - Jewelry stocks have likely encountered both Signet (SIG - Free Report) and Compagnie Financiere Richemont AG (CFRUY - 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 is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Right now, Signet is sporting a Zacks Rank of #2 (Buy), while Compagnie Financiere Richemont AG has a Zacks Rank of #3 (Hold). This means that SIG's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. 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.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

SIG currently has a forward P/E ratio of 9.20, while CFRUY has a forward P/E of 23.41. We also note that SIG has a PEG ratio of 0.76. 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. CFRUY currently has a PEG ratio of 3.65.

Another notable valuation metric for SIG is its P/B ratio of 1.94. 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, CFRUY has a P/B of 7.87.

Based on these metrics and many more, SIG holds a Value grade of A, while CFRUY has a Value grade of D.

SIG has seen stronger estimate revision activity and sports more attractive valuation metrics than CFRUY, so it seems like value investors will conclude that SIG is the superior option right now.


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