The shares of Sirius XM Holdings Inc. (NASDAQ:SIRI) and Lloyds Banking Group Plc (NYSE:LYG) were among the active stocks of the last trading sessions. Sirius XM Holdings Inc. (NASDAQ:SIRI) soared to 1.06% closing at the price of $6.2 whereas the shares of Lloyds Banking Group Plc (NYSE:LYG) soared 0% with the increase of 0 points closing at the price of $3.03. Sirius XM Holdings Inc. has currently decrease -1.2% in its stock over the period of 6-months while its rival Lloyds Banking Group Plc subtracted -21.91% 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 Sirius XM Holdings Inc. (NASDAQ:SIRI) is 22.3% while the ROI of Lloyds Banking Group Plc (NYSE:LYG) is 6.1%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, SIRI’s EBITDA Margin is 16.73 whereas LYG’s is NOT AVAILABLE.
Both the profitability ratios suggest a mixed sentiment for Sirius XM Holdings Inc. (NASDAQ:SIRI) and Lloyds Banking Group Plc (NYSE:LYG).
EPS & Surprise Factor
Technical Analysis of Sirius XM Holdings Inc. & Lloyds Banking Group Plc
Moving average convergence divergence (MACD) shows that Sirius XM Holdings Inc. (NASDAQ:SIRI) is on a PRICE RELATIVITY trend While Lloyds Banking Group Plc (NYSE:LYG) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Sirius XM Holdings Inc. was in BEARISH territory and Lloyds Banking Group Plc was in BEARISH territory.
SIRI’s current statistics gauge that the stock candle is BULLISH with MEDIUM volatility. While LYG’s candle is NEUTRAL with HIGH.
EPS Growth Rate: SIRI’s 20.89% versus LYG’s -3.5%
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 Sirius XM Holdings Inc. (NASDAQ:SIRI) is predicted at 20.89% while Lloyds Banking Group Plc (NYSE:LYG) stands at -3.5%. These numbers suggest that SIRI 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 SIRI stands at 0.2 while LYG is at 0 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 2.23.
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 2.7 for SIRI and 4 for LYG which means SIRI has Hold rating whereas LYG has Sell 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 SIRI is $6.98 which is 11.17% of its current price while LYG has price target of 3.02 which is -0.33% 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.
SIRI currently has price to earning P/E ratio of 28.42 whereas LYG has 11.18 while the forward P/E ratio for the prior stands at 22.53 and for the later it depicts the value of 8.91.
The price to Book P/B for SIRI is 0, Price to Sale is at 5.04 and for LYG these ratios stand at 0.87 and 2.58.