The shares of Henry Schein, Inc. (NASDAQ:HSIC) and National Steel Company (NYSE:SID) were among the active stocks of the last trading sessions. Henry Schein, Inc. (NASDAQ:HSIC) declined to -1.66% closing at the price of $86.97 whereas the shares of National Steel Company (NYSE:SID) soared 5.42% with the increase of 0.13 points closing at the price of $2.53. Henry Schein, Inc. has currently increase 25.43% in its stock over the period of 6-months while its rival National Steel Company added 2.85% 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 Henry Schein, Inc. (NASDAQ:HSIC) is 14.3% while the ROI of National Steel Company (NYSE:SID) is 7%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, HSIC’s EBITDA Margin is 14.44 whereas SID’s is 9.83.
Both the profitability ratios suggest that Henry Schein, Inc. (NASDAQ:HSIC) is more suitable investment in terms of profitability and return.
EPS & Surprise Factor
Henry Schein, Inc. (NASDAQ:HSIC) reported $1.04/share EPS for the previous quarter where analysts were predicting an EPS to be $1.01/share Thus beating the analyst Estimates with a Surprise Factor of 3 Percent. While, National Steel Company (NYSE:SID) reported EPS of $0.07/share in the last quarter. The analysts projected EPS of $0.03/share depicting a Surprise of 133.3 Percent.
Taking a look at Earnings per Share, National Steel Company tends to be beating the analyst estimates more than Henry Schein, Inc.. so SID is more profitable than HSIC.
Technical Analysis of Henry Schein, Inc. & National Steel Company
Moving average convergence divergence (MACD) shows that Henry Schein, Inc. (NASDAQ:HSIC) is on a PRICE RELATIVITY trend While National Steel Company (NYSE:SID) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the Henry Schein, Inc. was in BULLISH territory and National Steel Company was in BULLISH territory.
HSIC’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While SID’s candle is BEARISH with HIGH.
EPS Growth Rate: HSIC’s 10.66% versus SID’s 22.3%
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 Henry Schein, Inc. (NASDAQ:HSIC) is predicted at 10.66% while National Steel Company (NYSE:SID) stands at 22.3%. These numbers suggest that SID 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 HSIC stands at 1.3 while SID is at 1.3 whereas the debt ratio of the prior is 0.75 while the debt ratio of the later is 4.37.
The values of the both ratios suggest that SID is more suitable investment when the liquidity and risk is the main concern.
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 2.4 for HSIC and 2.3 for SID which means HSIC has Hold rating whereas SID 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 HSIC is $82.83 which is -5% of its current price while SID has price target of 2.96 which is 14.53% 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.
HSIC currently has price to earning P/E ratio of 24.4 whereas SID has 4.15 while the forward P/E ratio for the prior stands at 19.45 and for the later it depicts the value of 10.28.
The price to Book P/B for HSIC is 4.58, Price to Sale is at 1.02 and for SID these ratios stand at 1.93 and 0.68.