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KTB vs. LULU: Which Stock Is the Better Value Option?
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Investors looking for stocks in the Textile - Apparel sector might want to consider either Kontoor Brands (KTB - Free Report) or Lululemon (LULU - 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Currently, Kontoor Brands has a Zacks Rank of #1 (Strong Buy), while Lululemon 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 KTB is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.
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.
KTB currently has a forward P/E ratio of 11.67, while LULU has a forward P/E of 50.17. We also note that KTB has a PEG ratio of 1.46. 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. LULU currently has a PEG ratio of 2.74.
Another notable valuation metric for KTB is its P/B ratio of 15.34. 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, LULU has a P/B of 18.92.
Based on these metrics and many more, KTB holds a Value grade of B, while LULU has a Value grade of D.
KTB is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that KTB is likely the superior value option right now.
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KTB vs. LULU: Which Stock Is the Better Value Option?
Investors looking for stocks in the Textile - Apparel sector might want to consider either Kontoor Brands (KTB - Free Report) or Lululemon (LULU - 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.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Currently, Kontoor Brands has a Zacks Rank of #1 (Strong Buy), while Lululemon 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 KTB is likely seeing its earnings outlook improve to a greater extent. However, value investors will care about much more than just this.
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.
KTB currently has a forward P/E ratio of 11.67, while LULU has a forward P/E of 50.17. We also note that KTB has a PEG ratio of 1.46. 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. LULU currently has a PEG ratio of 2.74.
Another notable valuation metric for KTB is its P/B ratio of 15.34. 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, LULU has a P/B of 18.92.
Based on these metrics and many more, KTB holds a Value grade of B, while LULU has a Value grade of D.
KTB is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that KTB is likely the superior value option right now.