XELB vs. GOOS: Which Stock Is the Better Value Option?
Investors interested in stocks from the Retail - Apparel and Shoes sector have probably already heard of XCel Brands (XELB) and Canada Goose (GOOS). 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.
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 Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.
XCel Brands and Canada Goose are both sporting a Zacks Rank of # 2 (Buy) right now. 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 only part of the picture for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when 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.
XELB currently has a forward P/E ratio of 3.25, while GOOS has a forward P/E of 38.65. We also note that XELB has a PEG ratio of 0.32. 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. GOOS currently has a PEG ratio of 1.24.
Another notable valuation metric for XELB is its P/B ratio of 0.24. 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 18.33.
Based on these metrics and many more, XELB holds a Value grade of A, while GOOS has a Value grade of D.
Both XELB and GOOS 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
Canada Goose Holdings Inc. (GOOS) : Free Stock Analysis Report
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