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HIBB vs. MNSO: Which Stock Is the Better Value Option?

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Investors interested in stocks from the Retail - Apparel and Shoes sector have probably already heard of Hibbett and MINISO Group Holding Limited Unsponsored ADR (MNSO - Free Report) . But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

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 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.

Currently, Hibbett has a Zacks Rank of #1 (Strong Buy), while MINISO Group Holding Limited Unsponsored ADR 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 HIBB is likely seeing its earnings outlook improve to a greater extent. But this is only part of the picture 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.

HIBB currently has a forward P/E ratio of 9.48, while MNSO has a forward P/E of 21.85. We also note that HIBB has a PEG ratio of 0.54. 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. MNSO currently has a PEG ratio of 1.03.

Another notable valuation metric for HIBB is its P/B ratio of 3.13. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, MNSO has a P/B of 4.90.

These metrics, and several others, help HIBB earn a Value grade of A, while MNSO has been given a Value grade of C.

HIBB stands above MNSO thanks to its solid earnings outlook, and based on these valuation figures, we also feel that HIBB is the superior value option right now.


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