Gap Inc shares have lagged the S&P 500 in 2021, generating a year-to-date total return loss of 9.2 percent. Gap stock has had a wild ride in recent years, but investors may be wondering whether there’s any value in Gap shares after the recent pullback. Earnings A price-to-earnings ratio (PE) is one of the most basic fundamental metrics for gauging a stock’s value. The lower the PE, the higher the value. For comparison, the S&P 500’s PE is currently at about 29.6, nearly double its long-term average of 15.9. Gap’s PE is 14.2, less than half the S&P 500 average as a whole. Growth Looking ahead to the next four quarters, the S&P 500’s forward PE ratio looks much more reasonable at just 21.4. Gap’s forward earnings multiple of 9.4 is still less than half the S&P 500’s, making Gap look undervalued. Gap’s forward PE ratio is also less than …
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