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NUS vs. EL: Which Stock Is the Better Value Option?

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Investors with an interest in Cosmetics stocks have likely encountered both Nu Skin Enterprises (NUS - Free Report) and Estee Lauder (EL - 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.

There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. 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.

Nu Skin Enterprises and Estee Lauder are sporting Zacks Ranks of #2 (Buy) and #4 (Sell), respectively, right now. This means that NUS'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 also try to analyze a wide range of traditional figures and metrics to help determine whether 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.

NUS currently has a forward P/E ratio of 17.42, while EL has a forward P/E of 38.74. We also note that NUS has a PEG ratio of 1.62. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. EL currently has a PEG ratio of 4.06.

Another notable valuation metric for NUS is its P/B ratio of 3.06. 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. By comparison, EL has a P/B of 16.52.

These metrics, and several others, help NUS earn a Value grade of A, while EL has been given a Value grade of D.

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


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The Estee Lauder Companies Inc. (EL) - free report >>

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