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Should Value Investors Buy Tapestry (TPR) Stock?

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·3 min read
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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, value investing is easily one of the most popular ways to find great stocks in any market environment. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

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.

One stock to keep an eye on is Tapestry (TPR). TPR is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock holds a P/E ratio of 12.63, while its industry has an average P/E of 18.57. TPR's Forward P/E has been as high as 17.24 and as low as 7.69, with a median of 13.69, all within the past year.

We also note that TPR holds a PEG ratio of 1.26. 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. TPR's industry currently sports an average PEG of 1.57. Within the past year, TPR's PEG has been as high as 1.72 and as low as 0.77, with a median of 1.31.

Another notable valuation metric for TPR is its P/B ratio of 3.72. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This stock's P/B looks attractive against its industry's average P/B of 6.43. Within the past 52 weeks, TPR's P/B has been as high as 4.54 and as low as 1.71, with a median of 3.69.

Finally, investors should note that TPR has a P/CF ratio of 20.44. This metric focuses on a firm's operating cash flow and is often used to find stocks that are undervalued based on the strength of their cash outlook. This stock's P/CF looks attractive against its industry's average P/CF of 64.44. Over the past year, TPR's P/CF has been as high as 25 and as low as -64.29, with a median of -12.04.

These are just a handful of the figures considered in Tapestry's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that TPR is an impressive value stock right now.

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