LCUT vs. PBH: Which Stock Is the Better Value Option?
Investors with an interest in Consumer Products - Discretionary stocks have likely encountered both Lifetime Brands (LCUT) and Prestige Brands (PBH). 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.
Lifetime Brands and Prestige Brands are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that LCUT'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 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 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.
LCUT currently has a forward P/E ratio of 9.43, while PBH has a forward P/E of 13.90. We also note that LCUT has a PEG ratio of 0.67. 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. PBH currently has a PEG ratio of 1.74.
Another notable valuation metric for LCUT is its P/B ratio of 0.54. 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, PBH has a P/B of 2.05.
These metrics, and several others, help LCUT earn a Value grade of A, while PBH has been given a Value grade of C.
LCUT 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 LCUT is likely the superior value option right now.
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Lifetime Brands, Inc. (LCUT) : Free Stock Analysis Report
Prestige Consumer Healthcare Inc. (PBH) : Free Stock Analysis Report
