Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 3 stocks made the list for top value stocks in the Personal Care Products industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Personal Care Products Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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3 Undervalued Personal Care Products Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 3 undervalued stocks in the Personal Care Products industry for Tuesday, October 22, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Personal Care Products industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Edgewell Personal Care Company’s Value Grade

Value Grade:

Edgewell Personal Care Company, together with its subsidiaries, manufactures and markets personal care products worldwide. It operates through three segments: Wet Shave, Sun and Skin Care, and Feminine Care. The Wet Shave segment provides razor systems, such as razor handles and refillable blades, and disposable shave products for men and women under the Schick and Wilkinson Sword brands; and shave preparation products, including shaving gels and shaving creams under the Edge, Skintimate, Billie, Shave Guard brands. The Sun and Skin Care segment provides general protection, sport, kids, baby, tanning, and after sun products under the Banana Boat and Hawaiian Tropic brands; antibacterial hand wipes and other related products under the Wet Ones brand; skin care products for men under the Bulldog and Jack Black brands; and beard, hair, and skin care products under the Cremo brand. The Feminine Care segment provides tampons under the Playtex Gentle Glide 360°, Playtex Sport, Playtex, and o.b. brands; and markets pads and liners under the Stayfree and Carefree brands. The company distributes its products through direct sales force, exclusive and non-exclusive distributors, and wholesalers. The company was formerly known as Energizer Holdings, Inc. and changed its name to Edgewell Personal Care Company in June 2015. Edgewell Personal Care Company was founded in 1772 and is headquartered in Shelton, Connecticut.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Edgewell Personal Care Company has a Value Score of 81, which is considered to be undervalued.

When you look at Edgewell Personal Care Company’s price-to-sales ratio at 0.78 compared to the industry median at 0.92, this company has a lower price relative to revenue compared to its peers. This could make Edgewell Personal Care Company’s stock more attractive for value investors.

Edgewell Personal Care Company’s price-earnings ratio is 14.90 compared to the industry median at 27.20. This means it has a lower share price relative to earnings compared to its peers. This could make Edgewell Personal Care Company more attractive for value investors.

Now, let’s assess Edgewell Personal Care Company’s EV/EBITDA ratio, also known as enterprise multiple. At 9.2, when compared to the industry median of 13.2, the company may be considered undervalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Edgewell Personal Care Company’s shareholder yield is higher than its industry median ratio of (0.60%). Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Edgewell Personal Care Company’s price-to-book ratio is lower than its industry median ratio of 1.62. This could make Edgewell Personal Care Company more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Edgewell Personal Care Company’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Edgewell Personal Care Company’s price-to-free-cash-flow ratio is lower than its industry median ratio of 19.60. This could make Edgewell Personal Care Company more attractive because the lower P/FCF ratio indicates that Edgewell Personal Care Company is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Herbalife Ltd.’s Value Grade

Value Grade:

Herbalife Ltd. provides health and wellness products in North America, Mexico, South and Central America, Europe, the Middle East, Africa, China, and the Asia Pacific. It offers products in the areas of weight management; targeted nutrition; energy, sports, and fitness; outer nutrition; and literature and promotional items. The company also provides weight management products, including meal replacement products, protein shakes, drink mixes, weight loss supplements, healthy snacks, and metabolism boosting teas; targeted nutrition products, which comprise functional beverages, and dietary and nutritional supplements that contain herbs, vitamins, minerals, and other natural ingredients; outer nutrition products, such as facial skin, body, and hair care products; and energy, sports, and fitness products, including N-R-G tea and energy drink products. In addition, it offers literature, promotional, and other materials that comprise start-up kits, sales tools, and educational materials. The company sells its products through sales representatives, independent service providers, and company-operated retail platforms. Herbalife Ltd. was formerly known as Herbalife Nutrition Ltd. and changed its name to Herbalife Ltd. in April 2023. The company was founded in 1980 and is headquartered in Los Angeles, California.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Herbalife Ltd. has a Value Score of 94, which is considered to be undervalued.

Herbalife Ltd.’s price-earnings ratio is 8.3 compared to the industry median at 27.2. This means that it has a lower price relative to its earnings compared to its peers. This makes Herbalife Ltd. more attractive for value investors.

You can read more about Herbalife Ltd.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Medifast, Inc.’s Value Grade

Value Grade:

Medifast, Inc., through its subsidiaries, engages in the manufacture and sale of weight loss, weight management, and healthy living products in the United States and the Asia-Pacific. It offers bars, puffs, cereal, crunchers, drinks, hearty choices, oatmeal, pancakes, pudding, soft serve, shakes, smoothies, soft bakes, and soups under the OPTAVIA, OPTAVIA ACTIVE, and Optimal Health brand names. The company markets its products through point-of-sale transactions, as well as through ecommerce platform. Medifast, Inc. was founded in 1980 and is headquartered in Baltimore, Maryland.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Medifast, Inc. has a Value Score of 86, which is considered to be undervalued.

Medifast, Inc.’s price-earnings ratio is 6.6 compared to the industry median at 27.2. This means that it has a lower price relative to its earnings compared to its peers. This makes Medifast, Inc. more attractive for value investors.

Medifast, Inc.’s price-to-book ratio is higher than its peers. This could make Medifast, Inc. less attractive for value investors when compared to the industry median at 1.62.

You can read more about Medifast, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Personal Care Products Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Personal Care Products stocks as well as other industrys.

Choosing Which of the 3 Best Personal Care Products Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Edgewell Personal Care Company stock has a Value Grade of A.
• Herbalife Ltd. stock has a Value Grade of A.
• Medifast, Inc. stock has a Value Grade of A.

Now that you have a bit more background about each of the 3 undervalued stocks in the Personal Care Products industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Personal Care Products Stocks

Want to learn more about Personal Care Products stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 3 Undervalued Personal Care Products Stocks for Monday, October 21
• 4 Undervalued Personal Care Products Stocks for Friday, October 18
• 3 Undervalued Personal Care Products Stocks for Thursday, October 17
• 3 Undervalued Personal Care Products Stocks for Wednesday, October 16

AAII Disclaimer

We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.