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 Apparel & Accessories 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.

Latest Apparel & Accessories Stock News

Before choosing which top Apparel & Accessories stock to buy, be sure to conduct proper due diligence: analyze various financial metrics and look at historical data, public statements and news coverage.

The outlook for the apparel, accessories, and luxury goods is neutral. Analysts forecast a major shift in consumer spending in the latter half of 2021. As a result, more retailers are expected to go out of business. Reacting to an increased threat of store closures and bloated inventories, manufacturers will have significant order cutback, causing a supply chain shock. These same suppliers will struggle to keep a handle on their expenses such as wages, overhead, and raw materials costs. More and more, apparel brands are redefining the way they interact with their customers and the consumer experience. This likely involves cutting out the middleman going forward. There are major benefits to this approach however, such as building more personal relationships with apparel brands’ client base, maximizing margins, and tailoring market strategies to the ideal demographic. Additionally, apparel makers seek to utilize AI technology in their stores, allowing customers to see how items of clothing fit virtual mannequins or themselves before making the purchase. Early results from Zeekit show a 36% reduction in customer return rates due to this technology. Analysts forecast private label dollar share and units sold hitting 40% in 2021, which would reflect a more than six percentage point growth since 2017.

Why Focus on Undervalued Apparel & Accessories 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.

Click the button below to learn more about A+ Investor and subscribe today.

3 Undervalued Apparel & Accessories 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 Apparel & Accessories industry for Tuesday, November 14, 2023. Let’s take a closer look at their individual scores to see how they measure up against each other and the Apparel & Accessories 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.

Duluth Holdings Inc’s Value Grade

Value Grade:

Duluth Holdings Inc. is a lifestyle brand of men?s and women?s casual wear, workwear and accessories sold primarily through its own omnichannel platform. The Company?s products are marketed under the Duluth Trading Company brand, with many of the products being exclusively developed and sold as Duluth Trading branded merchandise. Its product assortment includes shirts, pants, underwear, outerwear, footwear, accessories and hard goods. Its products feature designs and distinct names, such as its Longtail T-shirts, Buck Naked underwear, Fire Hose work pants and No-Yank Tank. Its product assortment appeals to its customers for their everyday and on-the-job use. The Company?s omnichannel services include order-in-store, buy-online-pickup-in-store, and ship-from-store, as well as retail store and mobile shopping experiences. The Company operates approximately 62 retail stores and three outlet stores.

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.

Duluth Holdings Inc has a Value Score of 73, which is considered to be undervalued.

When you look at Duluth Holdings Inc’s price-to-sales ratio at 0.26 compared to the industry median at 0.52, this company has a lower price relative to revenue compared to its peers. This could make Duluth Holdings Inc’s stock more attractive for value investors.

Now, let’s assess Duluth Holdings Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 10.6, when compared to the industry median of 8.4, the company may be considered overvalued 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. Duluth Holdings Inc’s shareholder yield is lower than its industry median ratio of 0.51%. 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. Duluth Holdings Inc’s price-to-book ratio is lower than its industry median ratio of 1.48. This could make Duluth Holdings Inc more attractive to investors looking for a new addition to their portfolio.

Hanesbrands Inc.’s Value Grade

Value Grade:

Hanesbrands Inc. is a marketer of everyday basic innerwear and activewear apparel. The Company operates through three segments: Innerwear, Activewear and International. Its Innerwear segment includes apparel products, such as men?s underwear, women?s panties, children?s underwear, socks and intimate apparel, which includes bras and shapewear, and its primary brands include Hanes, Bali, Maidenform, Playtex, Champion, JMS/Just My Size, Bras N Things and Polo Ralph Lauren. The Company?s Activewear segment includes activewear products, such as T-shirts, fleece, performance apparel, sports shirts and thermals, and its primary brands include Champion, Hanes, Alternative, Gear for Sports, Comfortwash, JMS/Just My Size and Hanes Beefy-T. Its International segment includes innerwear, activewear and home goods products, and primary brands include Champion, Bonds, Sheridan, Bras N Things, Hanes, Playtex, Berlei, Wonderbra, Maidenform, Rinbros, Zorba, Sol y Oro and Polo Ralph Lauren.

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 63, 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 1.48.

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.

Sunstock Inc’s Value Grade

Value Grade:

Sunstock, Inc. is engaged in buying, selling, and distributing precious metals. The Company is primarily focused on gold. The Company operates one precious metal retail store in Mom's Silver Shop in Sacramento, California. The Mom's Silver Shop specializes in buying and selling gold, silver, and rare coins, and is a precious metals retailer. The Company is also engaged in acquiring mining assets as well as rights to purchase mining production and to sell these metals primarily through retail channels, including their own branded coins. The Company intends to focus on projects that already own amounts of unrefined but already mined-gold ore and other precious metals.

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.

Sunstock Inc has a Value Score of 81, which is considered to be undervalued.

Sunstock Inc’s price-to-book ratio is higher than its peers. This could make Sunstock Inc less attractive for value investors when compared to the industry median at 1.48.

You can read more about Sunstock 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 Apparel & Accessories 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 Apparel & Accessories stocks as well as other industrys.

Choosing Which of the 3 Best Apparel & Accessories 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.

• Duluth Holdings Inc stock has a Value Grade of B.
• Hanesbrands Inc. stock has a Value Grade of B.
• Sunstock 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 Apparel & Accessories 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 Apparel & Accessories Stocks

Want to learn more about Apparel & Accessories 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 Apparel & Accessories Stocks for Tuesday, November 14
• 4 Undervalued Apparel & Accessories Stocks for Monday, November 13
• Why Under Armour Inc’s (UAA) Stock Is Down 5.42%
• Why VF Corp’s (VFC) Stock Is Down 5.03%

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.