Investors with an interest in Retail - Apparel and Shoes stocks have likely encountered both Tapestry (TPR) and On Holding (ONON). 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.

Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. 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.

Tapestry and On Holding are both sporting 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. However, value investors will care about much more than just this.

Value investors analyze a variety of traditional, tried-and-true metrics to help find companies that they believe are undervalued at their 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.

TPR currently has a forward P/E ratio of 14.40, while ONON has a forward P/E of 37.88. We also note that TPR has a PEG ratio of 1.64. 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. ONON currently has a PEG ratio of 1.78.

Another notable valuation metric for TPR is its P/B ratio of 10.95. 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, ONON has a P/B of 17.62.

Based on these metrics and many more, TPR holds a Value grade of B, while ONON has a Value grade of F.

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

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This article originally published on Zacks Investment Research (zacks.com).

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