The shares of New York Times Company (The) (NYSE:NYT) and International Game Technology (NYSE:IGT) were among the active stocks of the last trading sessions. New York Times Company (The) (NYSE:NYT) soared to 4.2% closing at the price of $25.32 whereas the shares of International Game Technology (NYSE:IGT) declined -4.37% with the decrease of -0.77 points closing at the price of $16.84. New York Times Company (The) has currently increase 10.57% in its stock over the period of 6-months while its rival International Game Technology subtracted -34.45% 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 New York Times Company (The) (NYSE:NYT) is 6.7% while the ROI of International Game Technology (NYSE:IGT) is -1.5%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, NYT’s EBITDA Margin is 14.74 whereas IGT’s is 7.98.
Both the profitability ratios suggest that New York Times Company (The) (NYSE:NYT) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
New York Times Company (The) (NYSE:NYT) reported $0.17/share EPS for the previous quarter where analysts were predicting an EPS to be $0.15/share Thus beating the analyst Estimates with a Surprise Factor of 13.3 Percent. While, International Game Technology (NYSE:IGT) reported EPS of $0.28/share in the last quarter. The analysts projected EPS of $0.36/share depicting a Surprise of -22.2 Percent.
Taking a look at Earnings per Share, New York Times Company (The) tends to be beating the analyst estimates more than International Game Technology. so NYT is more profitable than IGT.
Technical Analysis of New York Times Company (The) & International Game Technology
Moving average convergence divergence (MACD) shows that New York Times Company (The) (NYSE:NYT) is on a PRICE RELATIVITY trend While International Game Technology (NYSE:IGT) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the New York Times Company (The) was in BULLISH territory and International Game Technology was in BEARISH territory.
NYT’s current statistics gauge that the stock candle is BULLISH with HIGH volatility. While IGT’s candle is BEARISH with HIGH.
EPS Growth Rate: NYT’s 16.1% versus IGT’s 27.6%
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 New York Times Company (The) (NYSE:NYT) is predicted at 16.1% while International Game Technology (NYSE:IGT) stands at 27.6%. These numbers suggest that IGT 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 NYT stands at 2 while IGT is at 1 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 4.14.
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 NYT and 1.9 for IGT which means NYT has Hold rating whereas IGT has Buy 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 NYT is $24.8 which is -2.1% of its current price while IGT has price target of 29.86 which is 43.6% 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.
NYT currently has price to earning P/E ratio of 46.37 whereas IGT has 0 while the forward P/E ratio for the prior stands at 25.86 and for the later it depicts the value of 9.68.
The price to Book P/B for NYT is 4.26, Price to Sale is at 2.44 and for IGT these ratios stand at 1.75 and 0.72.