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CPRI vs. FIGS: Which Stock Should Value Investors Buy Now?

Investors with an interest in Retail - Apparel and Shoes stocks have likely encountered both Capri Holdings (CPRI) and Figs (FIGS). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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 Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Capri Holdings and Figs are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. The Zacks Rank favors stocks that have recently seen positive revisions to their earnings estimates, so investors should rest assured that CPRI 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.

CPRI currently has a forward P/E ratio of 11.92, while FIGS has a forward P/E of 3,225. We also note that CPRI has a PEG ratio of 0.21. 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. FIGS currently has a PEG ratio of 998.45.

Another notable valuation metric for CPRI is its P/B ratio of 3.68. 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, FIGS has a P/B of 23.66.

These metrics, and several others, help CPRI earn a Value grade of B, while FIGS has been given a Value grade of F.

CPRI stands above FIGS thanks to its solid earnings outlook, and based on these valuation figures, we also feel that CPRI is the superior value option right now.


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Capri Holdings Limited (CPRI): Free Stock Analysis Report
 
FIGS, Inc. (FIGS): Free Stock Analysis Report
 
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