DTC or BKNG: Which Is the Better Value Stock Right Now?

Investors interested in Internet - Commerce stocks are likely familiar with Solo Brands, Inc. (DTC) and Booking Holdings (BKNG). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.

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 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.

Currently, Solo Brands, Inc. has a Zacks Rank of #1 (Strong Buy), while Booking Holdings has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that DTC likely has seen a stronger improvement to its earnings outlook than BKNG has recently. But this is just one piece of the puzzle 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.

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.

DTC currently has a forward P/E ratio of 3.21, while BKNG has a forward P/E of 20.32. We also note that DTC has a PEG ratio of 0.19. 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. BKNG currently has a PEG ratio of 1.

Another notable valuation metric for DTC is its P/B ratio of 0.70. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. For comparison, BKNG has a P/B of 19.01.

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

DTC 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 DTC is likely the superior value option right now.

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Solo Brands, Inc. (DTC) : Free Stock Analysis Report
 
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