JD vs. RVLV: Which Stock Is the Better Value Option?
Investors looking for stocks in the Internet - Commerce sector might want to consider either JD.com, Inc. (JD) or Revolve Group (RVLV). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
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.
JD.com, Inc. and Revolve Group are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that JD's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is only part of the picture 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.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
JD currently has a forward P/E ratio of 11.38, while RVLV has a forward P/E of 30.44. We also note that JD has a PEG ratio of 0.26. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. RVLV currently has a PEG ratio of 10.61.
Another notable valuation metric for JD is its P/B ratio of 1.14. 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, RVLV has a P/B of 2.73.
These metrics, and several others, help JD earn a Value grade of A, while RVLV has been given a Value grade of C.
JD 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 JD is likely the superior value option right now.
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JD.com, Inc. (JD) : Free Stock Analysis Report
Revolve Group, Inc. (RVLV) : Free Stock Analysis Report
