The shares of Whiting Petroleum Corporation (NYSE:WLL) and Mosaic Company (The) (NYSE:MOS) were among the active stocks of the last trading sessions. Whiting Petroleum Corporation (NYSE:WLL) declined to -4.74% closing at the price of $48.26 whereas the shares of Mosaic Company (The) (NYSE:MOS) declined -1.98% with the decrease of -0.67 points closing at the price of $33.11. Whiting Petroleum Corporation has currently increase 44.45% in its stock over the period of 6-months while its rival Mosaic Company (The) added 35.2% 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 Whiting Petroleum Corporation (NYSE:WLL) is -12.7% while the ROI of Mosaic Company (The) (NYSE:MOS) is 2.9%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, WLL’s EBITDA Margin is 8.23 whereas MOS’s is 11.24.
Both the profitability ratios suggest that Mosaic Company (The) (NYSE:MOS) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Whiting Petroleum Corporation (NYSE:WLL) reported $0.63/share EPS for the previous quarter where analysts were predicting an EPS to be $0.65/share Thus lagging the analyst Estimates with a Surprise Factor of -3.1 Percent. While, Mosaic Company (The) (NYSE:MOS) reported EPS of $0.4/share in the last quarter. The analysts projected EPS of $0.38/share depicting a Surprise of 5.3 Percent.
Taking a look at Earnings per Share, Mosaic Company (The) tends to be beating the analyst estimates more than Whiting Petroleum Corporation. so MOS is more profitable than WLL.
Technical Analysis of Whiting Petroleum Corporation & Mosaic Company (The)
Moving average convergence divergence (MACD) shows that Whiting Petroleum Corporation (NYSE:WLL) is on a PRICE RELATIVITY trend While Mosaic Company (The) (NYSE:MOS) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Whiting Petroleum Corporation was in BEARISH territory and Mosaic Company (The) was in BULLISH territory.
WLL’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While MOS’s candle is BEARISH with LOW.
EPS Growth Rate: WLL’s 0% versus MOS’s 29.6%
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 Whiting Petroleum Corporation (NYSE:WLL) is predicted at 0% while Mosaic Company (The) (NYSE:MOS) stands at 29.6%. These numbers suggest that MOS 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 WLL stands at 0.5 while MOS is at 1.6 whereas the debt ratio of the prior is 0.71 while the debt ratio of the later is 0.49.
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 2.3 for WLL and 2.3 for MOS which means WLL has Hold rating whereas MOS 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 WLL is $59.25 which is 18.55% of its current price while MOS has price target of 35.33 which is 6.28% 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.
WLL currently has price to earning P/E ratio of 0 whereas MOS has 32.88 while the forward P/E ratio for the prior stands at 11.88 and for the later it depicts the value of 15.02.
The price to Book P/B for WLL is 1.11, Price to Sale is at 2.5 and for MOS these ratios stand at 1.25 and 1.58.