PVH or COLM: Which Is the Better Value Stock Right Now?
Investors interested in Textile - Apparel stocks are likely familiar with PVH (PVH) and Columbia Sportswear (COLM). But which of these two stocks presents investors with the better value opportunity right now? Let's take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
PVH has a Zacks Rank of #2 (Buy), while Columbia Sportswear has a Zacks Rank of #4 (Sell) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that PVH 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.
PVH currently has a forward P/E ratio of 7.40, while COLM has a forward P/E of 16.10. We also note that PVH has a PEG ratio of 0.56. This figure is similar to the commonly-used P/E ratio, with the PEG ratio also factoring in a company's expected earnings growth rate. COLM currently has a PEG ratio of 1.32.
Another notable valuation metric for PVH is its P/B ratio of 0.92. 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, COLM has a P/B of 2.42.
These are just a few of the metrics contributing to PVH's Value grade of A and COLM's Value grade of C.
PVH has seen stronger estimate revision activity and sports more attractive valuation metrics than COLM, so it seems like value investors will conclude that PVH is the superior option right now.
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PVH Corp. (PVH) : Free Stock Analysis Report
Columbia Sportswear Company (COLM) : Free Stock Analysis Report
