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 Textiles, Apparel & Luxury Goods 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 Textiles, Apparel & Luxury Goods 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 Textiles, Apparel & Luxury Goods 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 Textiles, Apparel & Luxury Goods industry for Friday, November 22, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Textiles, Apparel & Luxury Goods 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.

Fossil Group, Inc.’s Value Grade

Value Grade:

Fossil Group, Inc., together with its subsidiaries, designs, develops, markets, and distributes consumer fashion accessories in the United States, Europe, Asia, and internationally. The company’s products include traditional watches, smartwatches, jewelry, handbags, small leather goods, belts, and sunglasses. It also manufactures and distributes private label brands, as well as branded products purchased for resell in other branded retail stores. The company offers its products under its proprietary brands, such as FOSSIL, SKAGEN, MICHELE, RELIC, and ZODIAC; and under the licensed brands, including ARMANI EXCHANGE, DIESEL, DKNY, EMPORIO ARMANI, KATE SPADE NEW YORK, MICHAEL KORS, TORY BURCH, and Skechers. The company sells its products through company-owned retail and outlet stores, department and specialty retail stores, mass market stores, e-commerce sites, licensed and franchised FOSSIL retail stores, and retail concessions, as well as sells its products on airlines. The company was formerly known as Fossil, Inc. and changed its name to Fossil Group, Inc. in May 2013. Fossil Group, Inc. was founded in 1984 and is headquartered in Richardson, Texas.

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.

Fossil Group, Inc. has a Value Score of 97, which is considered to be undervalued.

When you look at Fossil Group, Inc.’s price-to-sales ratio at 0.05 compared to the industry median at 0.72, this company has a lower price relative to revenue compared to its peers. This could make Fossil Group, Inc.’s stock more attractive for value investors.

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. Fossil Group, Inc.’s shareholder yield is lower than its industry median ratio of 1.70%. 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. Fossil Group, Inc.’s price-to-book ratio is lower than its industry median ratio of 2.07. This could make Fossil Group, Inc. more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Fossil Group, Inc.’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Fossil Group, Inc.’s price-to-free-cash-flow ratio is lower than its industry median ratio of 12.85. This could make Fossil Group, Inc. more attractive because the lower P/FCF ratio indicates that Fossil Group, Inc. 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.

Hanesbrands Inc.’s Value Grade

Value Grade:

Hanesbrands Inc., a consumer goods company, designs, manufactures, sources, and sells a range of range of innerwear apparels for men, women, and children in the Americas, Europe, the Asia pacific, and internationally. The company operates through three segments: Innerwear, Activewear, and International. It sells men’s underwear, women’s panties, children’s underwear, and socks, as well as intimate apparel comprising bras and shapewear; home goods; activewear apparel comprising T-shirts, fleece, performance apparel, sport shirts, performance T-shirts and shorts, sports bras, teamwear, and thermals; and licensed logo apparel in collegiate bookstores and mass retail channels. The company licenses its Champion name for footwear and sports accessories. It offers its products under the Hanes, Champion, Maidenform, JMS/Just My Size, Bali, Polo Ralph Lauren, Playtex, Alternative, Gear for Sports, Comfortwash, Hanes Beefy-T, Bonds, Sheridan, Bras N Things, Wonderbra, Berlei, Zorba, Sol y Oro, Maidenform, Rinbros, Bellinda, and RITMO brand names through retailers, wholesalers, and third-party embellishers. Hanesbrands Inc. was founded in 1901 and is headquartered in Winston-Salem, North Carolina.

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.

Hanesbrands Inc. has a Value Score of 61, which is considered to be undervalued.

Hanesbrands Inc.’s price-to-book ratio is lower than its peers. This could make Hanesbrands Inc. more attractive for value investors when compared to the industry median at 2.07.

You can read more about Hanesbrands 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.

JX Luxventure Limited’s Value Grade

Value Grade:

JX Luxventure Limited provides tourism services and supplying related products in the People's Republic of China. The company operates in Technology, Tourism Service, and Cross-Border E-Commerce segments. It engages in the sale of packaged group tour services; and provides health care, personal care, cosmetics, maternal and child, pet-related, universal cuisine and household products, and pre-owned electric cars through online and offline platforms. The company also offers real-time inventory management software solutions, which allows merchants to track product inventory levels in real-time, enabling them to make informed decisions regarding procurement and distribution, ultimately minimizing stockouts, and excess inventory; order processing and fulfillment software solutions that facilitates seamless order processing and fulfillment, ensuring timely delivery of products to customers and enhancing customer satisfaction; compliance and regulatory support software solutions, which equipped with tools to help businesses navigate complex cross-border regulatory requirements, ensuring compliance with various international trade laws and regulations; data analytics and reporting software solutions provides advanced data analytics and reporting capabilities, empowering merchants with valuable insights into their cross-border operations; and scalability and flexibility software solutions. In addition, it offers airline ticket and sales agent, tourism, and selling carrier services. The company was formerly known as KBS Fashion Group Limited and changed its name to JX Luxventure Limited in October 2021. JX Luxventure Limited is headquartered in Haikou, the People's Republic of China.

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.

JX Luxventure Limited has a Value Score of 96, which is considered to be undervalued.

JX Luxventure Limited’s price-earnings ratio is 2.5 compared to the industry median at 19.7. This means that it has a lower price relative to its earnings compared to its peers. This makes JX Luxventure Limited more attractive for value investors.

JX Luxventure Limited’s price-to-book ratio is higher than its peers. This could make JX Luxventure Limited less attractive for value investors when compared to the industry median at 2.07.

You can read more about JX Luxventure Limited’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 Textiles, Apparel & Luxury Goods 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 Textiles, Apparel & Luxury Goods stocks as well as other industrys.

Choosing Which of the 3 Best Textiles, Apparel & Luxury Goods 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.

• Fossil Group, Inc. stock has a Value Grade of A.
• Hanesbrands Inc. stock has a Value Grade of B.
• JX Luxventure Limited stock has a Value Grade of A.

Now that you have a bit more background about each of the 3 undervalued stocks in the Textiles, Apparel & Luxury Goods 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 Textiles, Apparel & Luxury Goods Stocks

Want to learn more about Textiles, Apparel & Luxury Goods 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 Textiles, Apparel & Luxury Goods Stocks for Friday, November 22
• 3 Undervalued Textiles, Apparel & Luxury Goods Stocks for Thursday, November 21
• 3 Undervalued Textiles, Apparel & Luxury Goods Stocks for Tuesday, November 19
• 4 Undervalued Textiles, Apparel & Luxury Goods Stocks for Monday, November 18

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