The shares of KKR & Co. L.P. (NYSE:KKR) and Turquoise Hill Resources Ltd. (NYSE:TRQ) were among the active stocks of the last trading sessions. KKR & Co. L.P. (NYSE:KKR) declined to -2.64% closing at the price of $26.97 whereas the shares of Turquoise Hill Resources Ltd. (NYSE:TRQ) declined -1.46% with the decrease of -0.03 points closing at the price of $2.03. KKR & Co. L.P. has currently increase 34.78% in its stock over the period of 6-months while its rival Turquoise Hill Resources Ltd. subtracted -30.48% in the previous 6-months.
Now we have to analyze the facts that if the stocks were worthy off investors’ money? The facts to analyze here are risks, profitability, returns and price trends.
Returns and Profitability
Profitability and returns are the main reason of investment, the investors are looking for profits that they get and return they should expect over the period of time.
The first and foremost return that is considered while making an investment is the ROI or Return on Investment. The ROI is the ratio between the profit against the cost of investment. Currently the ROI of KKR & Co. L.P. (NYSE:KKR) is 2.9% while the ROI of Turquoise Hill Resources Ltd. (NYSE:TRQ) is 0.8%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, KKR’s EBITDA Margin is NOT AVAILABLE whereas TRQ’s is 16.16.
Both the profitability ratios suggest that KKR & Co. L.P. (NYSE:KKR) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Technical Analysis of KKR & Co. L.P. & Turquoise Hill Resources Ltd.
Moving average convergence divergence (MACD) shows that KKR & Co. L.P. (NYSE:KKR) is on a PRICE RELATIVITY trend While Turquoise Hill Resources Ltd. (NYSE:TRQ) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the KKR & Co. L.P. was in BEARISH territory and Turquoise Hill Resources Ltd. was in BEARISH territory.
KKR’s current statistics gauge that the stock candle is BEARISH with MEDIUM volatility. While TRQ’s candle is BEARISH with MEDIUM.
EPS Growth Rate: KKR’s 4.47% versus TRQ’s 0%
Another shareholder value can be analyzed through the EPS growth rate; the next 5 years EPS growth rate is predicted by the analysts after the analyzing the previous trends. The next 5 year EPS growth rate of KKR & Co. L.P. (NYSE:KKR) is predicted at 4.47% while Turquoise Hill Resources Ltd. (NYSE:TRQ) stands at 0%. These numbers suggest that KKR is more suitable investment in terms of EPS growth rate.
Financial Risk and Liquidity Concerns
The current ratio and the debt ratio are the two ratios that show the investor how quickly the company is able to payout its debt and how quickly it can cover its obligations. The current ratio of KKR stands at 0 while TRQ is at 5.6 whereas the debt ratio of the prior is 2.53 while the debt ratio of the later is 0.45.
The values of the both ratios suggest that one is more liquid and other investment is more risk free.
While making an investment, another main factor to consider before investing is the analyst recommendation on the scale of 1 to 5 where 1 is strong buy, 2 is buy, 3 is hold, 4 is Sell and 5 is strong sell. Analyst recommend 1.8 for KKR and 3 for TRQ which means KKR has Buy rating whereas TRQ has Hold rating.
Another recommendation of analyst that is to be considered worthy is the price target. The mare price or price trend does not suggest the suitability of a stock. The price target set by analyst is also to be considered while investing as it suggests to what extent the stock will rise or fall in the near future. The price target set for KKR is $32.08 which is 15.93% of its current price while TRQ has price target of 4 which is 49.25% of its current price.
Valuation is the process of determining the company’s worth for an investor, the valuation ratios give an insight to that worthiness.
KKR currently has price to earning P/E ratio of 11.39 whereas TRQ has 10.91 while the forward P/E ratio for the prior stands at 14.38 and for the later it depicts the value of 26.03.
The price to Book P/B for KKR is 1.74, Price to Sale is at 7.46 and for TRQ these ratios stand at 0.45 and 3.86.