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Should Value Investors Buy G-III Apparel Group (GIII) Stock?

Zacks Equity Research

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

In addition to the Zacks Rank, investors looking for stocks with specific traits can utilize our Style Scores system. Of course, value investors will be most interested in the system's "Value" category. Stocks with "A" grades for Value and high Zacks Ranks are among the best value stocks available at any given moment.

G-III Apparel Group (GIII) is a stock many investors are watching right now. GIII is currently sporting a Zacks Rank of #1 (Strong Buy), as well as an A grade for Value. The stock holds a P/E ratio of 12.20, while its industry has an average P/E of 16.94. Over the past year, GIII's Forward P/E has been as high as 22.68 and as low as 8.55, with a median of 16.34.

Investors will also notice that GIII has a PEG ratio of 0.81. 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. GIII's industry has an average PEG of 1.15 right now. Within the past year, GIII's PEG has been as high as 1.51 and as low as 0.56, with a median of 1.11.

Value investors also frequently use the P/S ratio. This metric is found by dividing a stock's price with the company's revenue. Some people prefer this metric because sales are harder to manipulate on an income statement. This means it could be a truer performance indicator. GIII has a P/S ratio of 0.65. This compares to its industry's average P/S of 0.8.

These figures are just a handful of the metrics value investors tend to look at, but they help show that G-III Apparel Group is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, GIII feels like a great value stock at the moment.


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