TAP vs. NAPA: Which Stock Is the Better Value Option?
Investors with an interest in Beverages - Alcohol stocks have likely encountered both Molson Coors Brewing (TAP) and The Duckhorn Portfolio, Inc. (NAPA). 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
Molson Coors Brewing and The Duckhorn Portfolio, Inc. are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This means that TAP's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. But this is just one factor that value investors are interested in.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.
TAP currently has a forward P/E ratio of 13.31, while NAPA has a forward P/E of 27.16. We also note that TAP has a PEG ratio of 3.41. 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. NAPA currently has a PEG ratio of 4.47.
Another notable valuation metric for TAP is its P/B ratio of 0.83. 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, NAPA has a P/B of 2.15.
These are just a few of the metrics contributing to TAP's Value grade of A and NAPA's Value grade of D.
TAP has seen stronger estimate revision activity and sports more attractive valuation metrics than NAPA, so it seems like value investors will conclude that TAP is the superior option right now.
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Molson Coors Beverage Company (TAP) : Free Stock Analysis Report
The Duckhorn Portfolio, Inc. (NAPA) : Free Stock Analysis Report
