The shares of BlackBerry Limited (NYSE:BB) and Schlumberger N.V. (NYSE:SLB) were among the active stocks of the last trading sessions. BlackBerry Limited (NYSE:BB) declined to -0.8% closing at the price of $9.94 whereas the shares of Schlumberger N.V. (NYSE:SLB) declined -0.1% with the decrease of -0.06 points closing at the price of $62.94. BlackBerry Limited has currently decrease -6.49% in its stock over the period of 6-months while its rival Schlumberger N.V. subtracted -5.65% 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 BlackBerry Limited (NYSE:BB) is 10.6% while the ROI of Schlumberger N.V. (NYSE:SLB) is -1.9%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, BB’s EBITDA Margin is 61.36 whereas SLB’s is 14.77.
Both the profitability ratios suggest that BlackBerry Limited (NYSE:BB) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
BlackBerry Limited (NYSE:BB) reported $0.04/share EPS for the previous quarter where analysts were predicting an EPS to be $0.01/share Thus beating the analyst Estimates with a Surprise Factor of 300 Percent. While, Schlumberger N.V. (NYSE:SLB) reported EPS of $0.43/share in the last quarter. The analysts projected EPS of $0.43/share depicting a Surprise of 0 Percent.
Taking a look at Earnings per Share, BlackBerry Limited tends to be beating the analyst estimates more than Schlumberger N.V.. so BB is more profitable than SLB.
Technical Analysis of BlackBerry Limited & Schlumberger N.V.
Moving average convergence divergence (MACD) shows that BlackBerry Limited (NYSE:BB) is on a PRICE RELATIVITY trend While Schlumberger N.V. (NYSE:SLB) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the BlackBerry Limited was in BEARISH territory and Schlumberger N.V. was in BULLISH territory.
BB’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While SLB’s candle is BULLISH with MEDIUM.
EPS Growth Rate: BB’s 23.84% versus SLB’s 43.4%
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 BlackBerry Limited (NYSE:BB) is predicted at 23.84% while Schlumberger N.V. (NYSE:SLB) stands at 43.4%. These numbers suggest that SLB 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 BB stands at 6.4 while SLB is at 1.1 whereas the debt ratio of the prior is 0.3 while the debt ratio of the later is 0.48.
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 BB and 2.2 for SLB which means BB has Hold rating whereas SLB 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 BB is $11.79 which is 15.69% of its current price while SLB has price target of 74.82 which is 15.88% 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.
BB currently has price to earning P/E ratio of 0 whereas SLB has 0 while the forward P/E ratio for the prior stands at 55.22 and for the later it depicts the value of 25.29.
The price to Book P/B for BB is 2.19, Price to Sale is at 6.21 and for SLB these ratios stand at 2.39 and 2.7.