Investors interested in stocks from the Textile - Apparel sector have probably already heard of Gildan Activewear (GIL) and Kontoor Brands (KTB). But which of these two companies is the best option for those looking for undervalued stocks? Let's 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.

Both Gildan Activewear and Kontoor Brands have a Zacks Rank of # 2 (Buy) right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that these stocks have improving earnings outlooks. But this is just one factor that value investors are interested in.

Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their 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.

GIL currently has a forward P/E ratio of 16.64, while KTB has a forward P/E of 17.96. We also note that GIL has a PEG ratio of 1.85. 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. KTB currently has a PEG ratio of 2.24.

Another notable valuation metric for GIL is its P/B ratio of 4.96. 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, KTB has a P/B of 13.36.

These metrics, and several others, help GIL earn a Value grade of B, while KTB has been given a Value grade of C.

Both GIL and KTB are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that GIL is the superior value option right now.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Gildan Activewear, Inc. (GIL) : Free Stock Analysis Report

Kontoor Brands, Inc. (KTB) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research