HELE or ELF: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Cosmetics sector have probably already heard of Helen of Troy (HELE) and e.l.f. Beauty (ELF). 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.
Both Helen of Troy and e.l.f. Beauty have a Zacks Rank of # 2 (Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is only part of the picture for value investors.
Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.
HELE currently has a forward P/E ratio of 14.88, while ELF has a forward P/E of 63.49. We also note that HELE has a PEG ratio of 1.86. 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. ELF currently has a PEG ratio of 3.17.
Another notable valuation metric for HELE is its P/B ratio of 2.08. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, ELF has a P/B of 14.99.
These metrics, and several others, help HELE earn a Value grade of B, while ELF has been given a Value grade of F.
Both HELE and ELF are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that HELE is the superior value option right now.
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Helen of Troy Limited (HELE) : Free Stock Analysis Report
e.l.f. Beauty (ELF) : Free Stock Analysis Report
