HIBB vs. ULTA: Which Stock Is the Better Value Option?
Investors with an interest in Retail - Miscellaneous stocks have likely encountered both Hibbett Sports (HIBB) and Ulta Beauty (ULTA). But which of these two stocks offers value investors a better bang for their buck right now? We'll need to take a closer look.
There are plenty of strategies for discovering value stocks, but we have found that pairing a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system produces the best returns. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Hibbett Sports and Ulta Beauty have a Zacks Rank of # 1 (Strong Buy) right now. Investors should feel comfortable knowing that both of these stocks have an improving earnings outlook since the Zacks Rank favors companies that have witnessed positive analyst estimate revisions. But this is just one factor that value investors are interested in.
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.
Our Value category highlights undervalued companies by looking at a variety of key metrics, including the popular P/E ratio, as well as the P/S ratio, earnings yield, cash flow per share, and a variety of other fundamentals that have been used by value investors for years.
HIBB currently has a forward P/E ratio of 8.65, while ULTA has a forward P/E of 27.33. We also note that HIBB has a PEG ratio of 1.01. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. ULTA currently has a PEG ratio of 1.66.
Another notable valuation metric for HIBB is its P/B ratio of 2.71. 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, ULTA has a P/B of 9.75.
These are just a few of the metrics contributing to HIBB's Value grade of A and ULTA's Value grade of D.
Both HIBB and ULTA are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that HIBB is the superior value option right now.
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Hibbett Sports, Inc. (HIBB) : Free Stock Analysis Report
Ulta Beauty Inc. (ULTA) : Free Stock Analysis Report
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