Investors with an interest in Consumer Products - Staples stocks have likely encountered both Grocery Outlet Holding Corp. (GO) and Colgate-Palmolive (CL). 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 favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.

Right now, Grocery Outlet Holding Corp. is sporting a Zacks Rank of #2 (Buy), while Colgate-Palmolive has a Zacks Rank of #3 (Hold). Investors should feel comfortable knowing that GO likely has seen a stronger improvement to its earnings outlook than CL has recently. However, value investors will care about much more than just this.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its 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.

GO currently has a forward P/E ratio of 19.22, while CL has a forward P/E of 24.44. We also note that GO has a PEG ratio of 3.88. 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. CL currently has a PEG ratio of 4.74.

Another notable valuation metric for GO is its P/B ratio of 1.18. 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, CL has a P/B of 98.56.

These are just a few of the metrics contributing to GO's Value grade of B and CL's Value grade of D.

GO has seen stronger estimate revision activity and sports more attractive valuation metrics than CL, so it seems like value investors will conclude that GO is the superior option right now.

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Grocery Outlet Holding Corp. (GO):Free Stock Analysis Report

Colgate-Palmolive Company (CL):Free Stock Analysis Report

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

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