Revolve Group Inc (RVLV) receives a strong valuation score of 66 from InvestorsObserver's analysis. Our proprietary scoring system considers the overall health of the company by looking at the stock's price, earnings, and growth rate to determine if it represents a good value. RVLV holds a better value than 66% of stocks at its current price. Investors who are focused on long-term growth through buy-and-hold investing will find the Valuation Rank especially relevant when allocating their assets.
Metrics Analysis
RVLV has a trailing twelve month Price to Earnings (PE) ratio of 33.5. The historical average of roughly 15 shows a poor value for RVLV stock as investors are paying higher share prices relative to the company's earnings. RVLV's high trailing PE ratio shows that the firm has been trading above its fair market value recently. Its trailing 12-month earnings per share (EPS) of 0.55 does not justify the stock's current price. However, trailing PE ratios do not factor in the company's projected growth rate, resulting in many newer firms having high PE ratios due to high growth potential enticing investors despite inadequate earnings.
RVLV has a 12 month forward PE to Growth (PEG) ratio of 2.09. Markets are undervaluing RVLV in relation to its projected growth as its PEG ratio is currently below the fair market value of 1. 0.550000011's PEG comes from its forward price to earnings ratio being divided by its growth rate. PEG ratios are one of the most used valuation metrics due to its incorporation of more company fundamentals metrics and a focus on the firm's future rather than its past.
Summary
RVLV' has a weak valuation at its current share price on account of a overvalued PEG ratio despite strong growth. RVLV's PE and PEG are worse than the market average leading to a below average valuation score.
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