Yahoo Finance SKX vs. BIRK: Which Stock Is the Better Value Option?
Investors with an interest in Shoes and Retail Apparel stocks have likely encountered both Skechers (SKX) and Birkenstock (BIRK). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great 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.
Currently, Skechers has a Zacks Rank of #2 (Buy), while Birkenstock has a Zacks Rank of #3 (Hold). The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that SKX has an improving earnings outlook. But this is just one piece of the puzzle for value investors.
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.
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.
SKX currently has a forward P/E ratio of 18.15, while BIRK has a forward P/E of 44.76. We also note that SKX has a PEG ratio of 1.06. 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. BIRK currently has a PEG ratio of 1.86.
Another notable valuation metric for SKX is its P/B ratio of 2.48. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, BIRK has a P/B of 4.05.
These metrics, and several others, help SKX earn a Value grade of B, while BIRK has been given a Value grade of F.
SKX is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that SKX is likely the superior value option right now.
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Skechers U.S.A., Inc. (SKX) : Free Stock Analysis Report
Birkenstock Holding PLC (BIRK) : Free Stock Analysis Report
