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TPR vs. GOOS: Which Stock Is the Better Value Option?

Zacks Equity Research
·2 min read

Investors with an interest in Retail - Apparel and Shoes stocks have likely encountered both Tapestry (TPR) and Canada Goose (GOOS). 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 puts an emphasis on earnings estimates and estimate revisions, while our Style Scores work to identify stocks with specific traits.

Tapestry has a Zacks Rank of #2 (Buy), while Canada Goose has a Zacks Rank of #3 (Hold) right now. This means that TPR'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 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 Value category of the Style Scores system identifies undervalued companies by looking at a number of key metrics. These include the long-favored P/E ratio, P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that help us determine a company's fair value.

TPR currently has a forward P/E ratio of 9.61, while GOOS has a forward P/E of 80.37. We also note that TPR has a PEG ratio of 1.03. 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. GOOS currently has a PEG ratio of 7.66.

Another notable valuation metric for TPR is its P/B ratio of 2.17. 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, GOOS has a P/B of 11.04.

These are just a few of the metrics contributing to TPR's Value grade of B and GOOS's Value grade of F.

TPR stands above GOOS thanks to its solid earnings outlook, and based on these valuation figures, we also feel that TPR is the superior value option right now.


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Tapestry, Inc. (TPR) : Free Stock Analysis Report
 
Canada Goose Holdings Inc. (GOOS) : Free Stock Analysis Report
 
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Zacks Investment Research