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XELB or TPR: Which Is the Better Value Stock Right Now?

Here at Zacks, our focus is on the proven Zacks Rank system, which emphasizes earnings estimates and estimate revisions to find great stocks. Nevertheless, we are always paying attention to the latest value, growth, and momentum trends to underscore strong picks.

Investors looking for stocks in the Retail - Apparel and Shoes sector might want to consider either XCel Brands (XELB) or Tapestry (TPR). 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 emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.

Right now, both XCel Brands and Tapestry are sporting a Zacks Rank of # 2 (Buy). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that both of these companies have improving earnings outlooks. 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.

XELB currently has a forward P/E ratio of 5.63, while TPR has a forward P/E of 12.55. We also note that XELB has a PEG ratio of 0.56. 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. TPR currently has a PEG ratio of 1.12.

Another notable valuation metric for XELB is its P/B ratio of 0.31. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, TPR has a P/B of 3.06.

Based on these metrics and many more, XELB holds a Value grade of A, while TPR has a Value grade of C.

Both XELB and TPR are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that XELB is the superior value option right now.


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Xcel Brands, Inc (XELB) : Free Stock Analysis Report
 
Tapestry, Inc. (TPR) : Free Stock Analysis Report
 
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